International Factor Flows Tend to Lower Incomes of Those Factors

question 6

True/False

International factor flows tend to lower incomes of those factors in host countries that most directly substitute for that factor,and to raise the incomes of other factors.

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Definitions:

Service Cost

The actuarial present value of benefits earned by employees during a given period, included in the calculation of pension expense.

Actuarial Present Value

A calculation used to determine the present value of a future series of payments or receipts, taking into account variables such as mortality, investment earnings, and expense risks.

Net Periodic Pension Cost

The net periodic pension cost is the total expense recognized in a period related to an employer's pension plan, including service costs, interest costs, expected returns on plan assets, and any amortizations.