207. It is on the matter of fact that there is not much migration of capital and labor from country to country that Mr. Mill has based his whole doctrine of “international trade and international values.” Explain and comment on the above statement.
208. What are the causes which determine for a nation the cost of its imports?
209. It follows from the theory of international values, as laid down by Mill, that the permanent residence of Americans in Europe may enhance the cost of foreign imports to Americans residing at home. Explain in what way.
210. Suppose two countries, A and B, isolated from the rest of the world, and a trade established between them. In consequence of the labor of A becoming less effective, the cost of production of every article which can be produced in that country is greatly increased, but so that the relation between the costs of any two articles remains the same. What, if any, will be the effect of the change on the trade between A and B? Does your answer depend upon your using the phrase “cost of production” in a sense different from that given to it by some economists?
211. Show that every country gets its imports at less cost in proportion to the efficiency of its labor.
Foreign Exchanges.
212. What is the ordinary limit to the premium on foreign bills of exchange, and why?
213. What are the chief effects on the foreign exchanges which are produced by the breaking out of a war? Account for the fact that in 1861 the exchanges on England in America fell considerably below specie point.
214. Suppose that the next harvest in England should be very defective, and extraordinary supplies of American grain needed. How would this probably affect the price of bills of exchange between England and America, and the profit on the exportation of English manufactures to the latter, and why?
215. Trace the process by which the precious metals spread from the mines over the world.