Assume the Standard Trade Model with Two Countries (Alpha and Beta)

Multiple Choice

Assume the standard trade model with two countries (Alpha and Beta) , two goods (food and drink) , and two factors of production (land and labor) . Further assume that Alpha is relatively labor-abundant and drink is relatively labor-intensive. According to the Heckscher-Ohlin theory, Beta has a comparative advantage in the production of:

A) drink.
B) food.
C) both goods.
D) neither good.