SCENARIO: TRADE IN GOODS BETWEEN CHINA

Multiple Choice

SCENARIO: TRADE IN GOODS BETWEEN CHINA
AND THE UNITED STATES
(1) China has 1,000 units of capital and 3,000
Workers; (2) the United States has 3,000 units of
Capital and 1,000 workers; (3) clothing production is
Labor intensive, and (4) chemical production is capital
Intensive.
Reference: Ref 5­1
(Scenario: Trade in Goods Between China and the
United States) Suppose that the United States
Eliminates all restrictions on immigration and Chinese
Workers are free to emigrate from China to the United
States.How many Chinese workers must emigrate
From China to the United States in order for factor
Price equalization to occur?

A) 1,000
B) 2,000
C) 3,000
D) 4,000