中欧纺织品纷争初级.pptVIP

We can see how the wage rate and employment in each sector are determined given the prices of food and manufacture in Figure 3-4. Relationship between relative prices and output. At the production point the curve PP must be tangent to a line whose slope is minus the price of manufactures divided by that of food. -MPLF/MPLM = -PM/PF (3-7) It derived from equations (3-4) and (3-5) MPLM × PM = MPLF × PF = w Slope = - (PM /PF)1 1 Q1F Q1M Output of manufactures, QM Output of food, QF PP Figure 3-5: Production in the Specific F