One Way in Which the Heckscher- Ohlin Model Differs from the Ricardo

question 26

Multiple Choice

One way in which the Heckscher- Ohlin model differs from the Ricardo model of comparative advantage is by assuming that is (are) identical in all countries.

• A)opportunity costs
• B)scale of production
• C)factor intensities
• D)technology
• E)factor endowments

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Definitions:

Capital

Economic resources or assets used in the production of goods and services, such as machinery, buildings, or tools.

Marginal Product

The additional output resulting from the use of one more unit of a production input, holding other inputs constant.

Factor Market

A marketplace for the services of a factor of production, such as labor, capital, or land, essential for production processes.

Equilibrium Value

The price or value at which the quantity supplied is equal to the quantity demanded in a market.