Assume the Standard Trade Model with Two Countries (Alpha and Beta)

question 57

Multiple Choice

Assume the standard trade model with two countries (Alpha and Beta) , two goods (food and drink) , and two factors of production (land and labor) . Further assume that Alpha is relatively labor-abundant and drink is relatively labor-intensive. The pre-trade wage rate relative to land rents in Alpha is _____ the relative wage rate in Beta.

• A)greater than
• B)less than
• C)equal to
• D)double

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Definitions:

Wholly Owned Subsidiaries

Companies whose entire share capital is owned by another company, the parent company.

International Sector

The segment of an economy or business operations that involves dealing with foreign countries, including trade, investments, and regulatory practices.

Act of State Doctrine

A principle in international law that a nation is immune from being sued in another nation's courts for its sovereign acts.

Internal Actions

Measures or processes initiated within an organization to handle its affairs, without involving external enforcement or intervention.