An Implication of the Heckscher-Ohlin Model Is That Trade Will

question 4

Multiple Choice

An implication of the Heckscher-Ohlin model is that trade will tend to

• A)bring factor prices into equality in different countries.
• B)cause factor prices to fall in different countries.
• C)be diverted from countries with higher factor prices.
• D)not have any effect on factor prices in different countries.
• E)cause factor prices to rise in different countries.

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Definitions:

Demand Curve

An illustration depicting the correlation between a product's price and the level of demand from buyers, often characterized by a descending trajectory.

MR

Marginal Revenue, which is the increase in revenue resulting from the sale of one additional unit of a product.

Output Level

The amount of output produced by a firm or an industry within a certain period.

Demand Curve

An illustrated diagram indicating how consumer demand for a product varies with changes in its price.