The Heckscher-Ohlin Theory Predicts That the Opening of Trade Between

question 1

Multiple Choice

The Heckscher-Ohlin theory predicts that the opening of trade between a land-abundant country and a labor-abundant country should result in:

• A)higher rents and wages in both countries.
• B)lower rents and wages in both countries.
• C)higher rents in the labor-abundant country and higher wages in the land-abundant country.
• D)higher wages in the labor-abundant country and higher rents in the land-abundant country.

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Definitions:

Meaningless

Lacking significance, purpose, or value.

Meaningful

Anything that holds significant purpose or value for an individual, making it worthwhile and important.

Overgeneralization

The application of a rule or conclusion to more instances than is justified, often leading to mistaken beliefs or misjudgments.

Traditional Thinking

A mindset adhering to established practices, beliefs, or methods, often resistant to change or innovation.