Question 1

In the Heckscher­Ohlin model with two goods and two
Factors, an increase in one factor will cause:

Accepted Answer

A) an increase in the production of the good that uses the factor intensively. 
B) a decrease in the production of the good that use the factor intensively. 
C) an increase in the production of the good that does not use the factor intensively. 
D) no change in the production of both goods. 
A) an increase in the production of the good that uses the factor intensively. 
B) a decrease in the production of the good that use the factor intensively. 
C) an increase in the production of the good that does not use the factor intensively. 
D) no change in the production of both goods.

Question 2

Legal immigrants into the United States tend to
Compete mainly with:

Accepted Answer

A) highly educated American workers. 
B) poorly educated American workers. 
C) all American workers. 
D) one another. 
A) highly educated American workers. 
B) poorly educated American workers. 
C) all American workers. 
D) one another.

Question 3

When the supply of labor increases, according to the
Specific­factors model, which of the following is likely to
Happen in the sending country?

Accepted Answer

A) The number of workers employed will decrease. 
B) The wages for workers will rise. 
C) The marginal product of labor shifts to the right. 
D) All of these are likely to happen in the sending country. 
A) The number of workers employed will decrease. 
B) The wages for workers will rise. 
C) The marginal product of labor shifts to the right. 
D) All of these are likely to happen in the sending country.

Question 4

Some economists have proposed a "brain drain" tax to
Be administered though the United Nations.This tax
Would:

Accepted Answer

A) Compensate firms that hire people who need remedial reading and writing skills to be able to
Function in an advanced economy. 
B) repay the nations of origin of highly educated immigrants for their losses. 
C) force immigrants to pay taxes where they work instead of where they live. 
D) require the national government to pay taxes to states to recover the cost of educating immigrants. 
A) Compensate firms that hire people who need remedial reading and writing skills to be able to
Function in an advanced economy. 
B) repay the nations of origin of highly educated immigrants for their losses. 
C) force immigrants to pay taxes where they work instead of where they live. 
D) require the national government to pay taxes to states to recover the cost of educating immigrants.

Question 5

In an economy with two industries, an increase in
Immigration will:

Accepted Answer

A) cause employment to increase in both in the long run. 
B) cause employment to increase in one and decrease in the other in the short run. 
C) cause employment to increase in one and decrease in the other in the long run. 
D) cause a decline in wages in both industries in the long run. 
A) cause employment to increase in both in the long run. 
B) cause employment to increase in one and decrease in the other in the short run. 
C) cause employment to increase in one and decrease in the other in the long run. 
D) cause a decline in wages in both industries in the long run.

Question 6

In the long run, immigration will shift the sending
Country's production possibilities frontier inward.This
Shift will cause:

Accepted Answer

A) a larger decline in the potential output of the capital­intensive good. 
B) a larger decline in the potential output of the labor­ intensive good. 
C) equal declines in the potential output of both the labor­intensive and the capital­intensive good. 
D) a decline in the potential output of the labor­ intensive good and an increase in the potential output
Of the capital­intensive good. 
A) a larger decline in the potential output of the capital­intensive good. 
B) a larger decline in the potential output of the labor­ intensive good. 
C) equal declines in the potential output of both the labor­intensive and the capital­intensive good. 
D) a decline in the potential output of the labor­ intensive good and an increase in the potential output
Of the capital­intensive good.

Question 7

During the past 20 years, there has been substantial
FDI in China.What are the expected short­run effects
Of this FDI upon the rental rate on capital and wages
In China?

Accepted Answer

A) The rental rate should increase and wages should decrease. 
B) The rental rate and wages should both increase. 
C) The rental rate and wages should both decrease. 
D) The rental rate should decrease and wages should increase. 
A) The rental rate should increase and wages should decrease. 
B) The rental rate and wages should both increase. 
C) The rental rate and wages should both decrease. 
D) The rental rate should decrease and wages should increase.

Question 8

Emigration causes __________ in the capital-labor
Ratio and __________ in the return to capital.

Accepted Answer

A) increases; decreases 
B) increases; increases 
C) decreases; decreases 
D) decreases; increases 
A) increases; decreases 
B) increases; increases 
C) decreases; decreases 
D) decreases; increases

Question 9

Consider an economy that only produces steel and
Shoes; steel is capital intensive and shoes are labor
Intensive.How will emigration of labor from this
Economy affect the marginal productivity of labor?

Accepted Answer

A) It will fall. 
B) It will not change. 
C) It will rise. 
D) It will fall in the short run and rise in the long run. 
A) It will fall. 
B) It will not change. 
C) It will rise. 
D) It will fall in the short run and rise in the long run.

Question 10

Foreign direct investment that takes the form of a new
Startup facility is called:

Accepted Answer

A) acquisition FDI. 
B) greenfield FDI. 
C) intermediary FDI. 
D) brownfield FDI. 
A) acquisition FDI. 
B) greenfield FDI. 
C) intermediary FDI. 
D) brownfield FDI.

Question 11

Because most immigrants into the United States are
Either highly skilled or unskilled, the majority of
Workers:

Accepted Answer

A) see very little impact on their wages as a result of immigration. 
B) have difficulty finding jobs and getting raises because of all the competition from immigrants. 
C) feel a big hit on wages and unemployment. 
D) must rely on trade adjustment assistance for help retraining and relocating. 
A) see very little impact on their wages as a result of immigration. 
B) have difficulty finding jobs and getting raises because of all the competition from immigrants. 
C) feel a big hit on wages and unemployment. 
D) must rely on trade adjustment assistance for help retraining and relocating.

Question 12

To study labor migration using the specific­factors
Model, we assume ________ and ________ cannot
Move within the domestic economy, but we allow
________ to move both domestically and
Internationally.

Accepted Answer

A) land; capital; labor 
B) labor; land; capital 
C) land; loanable funds; capital 
D) labor; capital; land 
A) land; capital; labor 
B) labor; land; capital 
C) land; loanable funds; capital 
D) labor; capital; land

In the HeckscherOhlin model with two goods and two Factors, an increase in one factor will cause:

Legal immigrants into the United States tend to Compete mainly with:

When the supply of labor increases, according to the Specificfactors model, which of the following is likely to Happen in the sending country?

Some economists have proposed a "brain drain" tax to Be administered though the United Nations.This tax Would:

In an economy with two industries, an increase in Immigration will:

In the long run, immigration will shift the sending Country's production possibilities frontier inward.This Shift will cause:

During the past 20 years, there has been substantial FDI in China.What are the expected shortrun effects Of this FDI upon the rental rate on capital and wages In China?

Emigration causes in the capital-labor Ratio and in the return to capital.

Consider an economy that only produces steel and Shoes; steel is capital intensive and shoes are labor Intensive.How will emigration of labor from this Economy affect the marginal productivity of labor?

Foreign direct investment that takes the form of a new Startup facility is called:

Because most immigrants into the United States are Either highly skilled or unskilled, the majority of Workers:

To study labor migration using the specificfactors Model, we assume and cannot Move within the domestic economy, but we allow to move both domestically and Internationally.

The Global Economy

Trade and Technology: the Ricardian Model

Gains and Losses From Trade in the Specific-Factors Model

Trade and Resources: the Heckscher-Ohlin Model

Increasing Returns to Scale and Monopolistic Competition

Import Tariffs and Quotas Under Perfect Competition

Import Tariffs and Quotas Under Imperfect Competition

International Agreements: Trade, Labor, and the Environment

Introduction to Exchange Rates and the Foreign Exchange Market

Exchange Rates I: the Monetary Approach in the Long Run

Filters

Exam 5: Movement of Labor and Capital Between Countries

In the Heckscher­Ohlin model with two goods and two Factors, an increase in one factor will cause: