In the 2- Factor,2- Good Heckscher- Ohlin Model,an Influx of Workers

question 36

Multiple Choice

In the 2- factor,2- good Heckscher- Ohlin model,an influx of workers from across the border would

• A)shift the production possibility curve outward and decrease the production of the capital- intensive product.
• B)shift the production possibility curve outward and decrease the production of the labor- intensive product.
• C)shift the production possibility curve outward,and increase the production of both goods.
• D)move the point of production along the production possibility curve.
• E)shift the possibility curve outward and displace preexisting labor.

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Definitions:

Perfectly Competitive

A market structure characterized by a large number of small firms, a homogeneous product, freedom of entry and exit, and perfect information.

VMPL

The value of the marginal product of labor, which is the additional value created from an increase in labor input.

Equilibrium Market Wage

The wage rate at which the quantity of labor supplied and the quantity of labor demanded are equal.

Bricklayers

Tradespeople who lay bricks, concrete blocks, and other types of masonry materials to construct or repair walls, partitions, and other structures.