In the Specific Factors Model,the Effects of Trade on Welfare

question 66

Multiple Choice

In the specific factors model,the effects of trade on welfare overall are ________ and for fixed factors used to produce the exported good they are ________.

• A) positive; positive
• B) negative; positive
• C) positive; negative
• D) ambiguous; positive
• E) positive; ambiguous

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Definitions:

Police Protection

A mechanism of public security provided by governmental police forces aiming to maintain order, enforce the law, and prevent and investigate crime.

Imperfect Information

A situation in which all parties in a transaction do not have equal access to relevant information, leading to inefficiencies in the market.

Market Failure

A situation in which a market left on its own fails to allocate resources efficiently, often justifying government intervention.

Nutrition Labeling

Information provided on food packaging that details the nutrient content, such as calories, fats, vitamins, and minerals.