Meitneria and Seaboria Specialize in the Production of Heavy Machinery

question 34

Multiple Choice

Meitneria and Seaboria specialize in the production of heavy machinery and textiles respectively.While Meitneria doesn't produce textiles,Seaboria is not as technologically advanced as Meitneria.In this situation,according to the Heckscher-Ohlin theory:

• A) Meitneria will import textiles from Seaboria and export heavy machinery to it.
• B) Meitneria will invest more than Seaboria in the production of textiles to exploit its comparative advantage.
• C) Meitneria and Seaboria will raise their trade barriers to protect their economies.
• D) Seaboria will recruit experts from Meitneria to specialize in the production of heavy machinery.
• E) Meitneria will recruit worksmen from Seaboria to improve its standing in the textile industry.

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Definitions:

Patents

Legal documents granting exclusive rights to inventors for their innovations, preventing others from making, using, or selling the invention for a certain period of time.

Accounts Receivable

Money that is owed to a company by its customers for goods or services that have been delivered but not yet paid for.

Marginal Tax Rate

The rate at which the last dollar of a taxpayer's income is taxed, indicating the percentage of tax applied to their highest dollar of income.