How Can We Model Long­run FDI Flows Using a Model

question 120

Multiple Choice

How can we model long­run FDI flows using a model
Similar to the long­run effects of long­run labor
Migration?

• A)Use a simple supply­and­demand approach.
• B)Use the Ricardian comparative advantage model.
• C)Use the Heckscher­Ohlin model with the assumption that capital can migrate.
• D)Use the Rybczynski theorem.

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Definitions:

Capital Cost Allowance (CCA)

A tax deduction that Canadian businesses can claim for the depreciation of tangible and intangible assets.

Manufacturing Equipment

Manufacturing equipment refers to the machinery and tools used in the process of producing goods or handling materials.

Labour And Materials

The costs associated with the workforce (labour) and the raw materials used in the production of goods and services.

Tax Rate

The percentage at which an individual or corporation is taxed by the government, varying based on income or profit levels.