In the Specific Factors Model, the Effects of Trade on Welfare

question 15

Multiple Choice

In the specific factors model, the effects of trade on welfare overall are ________ and for fixed factors used to produce the exported good they are ________.

• A) positive; positive
• B) positive; ambiguous
• C) negative; positive
• D) positive; negative
• E) ambiguous; positive

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Definitions:

Scientific Method

A systematic and empirical approach to research in which a problem is identified, hypotheses are formulated, experiments or observations are conducted, and conclusions are drawn.

Ice Cream

A frozen dessert made from dairy products, sweeteners, and flavorings, enjoyed as a treat or snack.

Buying Behavior

The decision processes and acts of individuals involved in buying and using products.

Opportunity Cost

The cost of an alternative that must be forgone as a result of choosing another option, representing the benefits that could have been received by taking a different path.