Exam 4: Comparative Advantage and Factor Endowments

Use the below mentioned table for the following question(s). Suppose that all goods are made with two factors-labor and capital.The table below shows the total endowments of each factor in the United States and Canada. Table 4.1 Endowment of Labor and Capital -Based on Table 4.1,according to the Stolper-Samuelson Theorem,the income distribution effects of free trade in the United States are likely to favor

Using the specific factors model,assume that strawberry production requires the specific factor of land,tractor production requires the specific factor of capital,and labor is variable.If the United States is capital abundant compared to Mexico,and Mexico is land abundant compared to the United States,then in the short run with trade we would expect

What is the source of comparative advantage in the Heckscher-Ohlin model?

The Stolper-Samuelson Theorem predicts

Wage inequality has been on the rise in virtually all high-income industrial economies since the 1970s.The causes are probably numerous,but the leading explanation for the greatest share of the increase in inequality is

In the Heckscher-Ohlin model,what assumption is made about opportunity costs?

A production possibilities curve that is a straight line represents the case of

Using the specific factors model,assume that strawberry production requires the specific factor of land,tractor production requires the specific factor of capital,and labor is variable.If the United States is capital abundant compared to Mexico,and Mexico is land abundant compared to the United States,then in the short run with trade,which of the following is TRUE?

Which of the following would NOT be associated with the LATE PHASE of the product cycle?

What is the Heckscher-Ohlin theorem? Using the case studies in the chapter on U.S.trade with China describe the theory and the resulting trade patterns that would support it.

What are the factors that have been identified that affect a migration decision? Give examples of each.

According to OLI theory,a firm might be unwilling to license its production to a foreign firm for fear that its technology may be stolen or its brand name harmed,which leads the firm to internalize control over its asset and set up its own foreign subsidiary.

The straight-line production possibilities curve introduced in the text

Use the below mentioned table for the following question(s). Suppose that all goods are made with two factors-labor and capital.The table below shows the total endowments of each factor in the United States and Canada. Table 4.1 Endowment of Labor and Capital -Based on Table 4.1,according to the Heckscher-Ohlin Theorem,U.S.exports should be goods that

Offshoring by domestic firms causes job losses not job expansion in the home market.

The primary interest of firms engaging in offshoring is to find lower wages and to decrease production costs.

Using the HO model,assume that the United States is capital abundant and Mexico is labor abundant.If soybeans are capital intensive and avocados are labor intensive,it would be reasonable to expect the United States to

A production possibilities curve that is bowed out represents the case of

Suppose that Brazil is capital abundant and Chile is natural resource abundant.If timber is natural resource intensive and computers are capital intensive,then according to the Heckscher-Ohlin Theorem,Chile should export goods that

OLI theory is a direct contradiction of trade theory,especially trade theory based on comparative advantage.