Internal Economies of Scales - Level of Trade Between Bangladesh and Sri Lanka - Management Assignment Help

Assignment Task :

a) Explain how internal economies of scales and monopolistic competition can be used to explain for intra-industry trade, and North-North trade?

b) Refer to the table below and based on the gravity equation, compare the expected level of trade between Bangladesh and Sri Lanka, and between Bangladesh and India. 

a) What are the differences between the Ricardo's model and the HO model?

b) Base on the Figure below, explain which country (Home or Foreign) has a comparative advantage in which good, and why both countries benefit from trade with one another. 

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