Exam 4: Trade and Resources: the Heckscher-Ohlin Model

The following table represents autarkic and free-trade production and consumption and resource use for Suburbia. I. Is Surburbia a labor-abundant or a capital-abundant country? Explain your answer. II. What is the price of good X in autarky? With free trade? III. How many units of what product are exported? How many units of what product are imported? IV. Has the marginal product of labor in good X production increased or decreased? Explain your answer. V. Has the marginal product of capital in good Y production increased or decreased? Explain your answer.

Why is the specific-factors model referred to as a "short-run" version of the Heckscher-Ohlin model?

(Figure: Home and Foreign Autarky Equilibria) Which line in the graph represents the home relative price of computers in terms of shoes?

The wage paid to labor should increase when:

The conclusion that international trade will lead to an increase in real earnings of a country's abundant resource is known as:

(Figure: Home and Foreign Autarky Equilibria) If shoes are a labor-intensive industry, which nation is labor abundant?

Which statement best describes the Heckscher-Ohlin model?

Which of the following statements is correct?

Why is the PPF bowed out in the Heckscher-Ohlin model?

Which of the following countries had the most R&D scientists in 2013?

LCD TVs are capital intensive, and tennis racquets are labor intensive. Suppose Canada has $100 billion of capital and 2 million workers and Mexico has $10 billion of capital and 20 million workers. According to the Heckscher-Ohlin model:

Suppose that the United States and China each produce steel and cloth. In the Heckscher-Ohlin model, if the United States enjoys a comparative advantage in steel production, then:

(Table: Data on Suburbia) Use this table, which represents autarkic and free-trade production and consumption and resource use for Suburbia, to answer the following question. Which of the following statement is correct?

A problem with measuring the factor shares to determine scarcity or abundance is that:

I. Is the United States a net exporter or importer of agricultural products? II. Consider a Heckscher-Ohlin model with arable land as one of the two resources. Are the model's predictions consistent with the data presented in the text?

Suppose that Home has 20% of the world's capital, 10% of the world's skilled labor, and 30% of the world's unskilled labor and produces 20% of the world's GDP. What does this information suggest?

The Heckscher-Ohlin model assumes that technology in each industry:

Leontief's study of U.S. post-World War II trade concluded that the:

Which of the following countries had the most illiterate labor in 2013?

Consider two products: automobiles and shoes. If shoes are labor intensive and automobiles are capital intensive, what will happen under the Heckscher-Ohlin model?