According to the Short-Run (Specific-Factors) Model, How Will FDI Affect

Multiple Choice

According to the short-run (specific-factors) model, how will FDI affect the marginal productivity of labor in the recipient nation?

A) The MPL will rise in the production of both the labor- and capital-intensive goods.
B) The MPL will rise only in the production of the labor-intensive good.
C) The MPL will rise only in the production of the capital-intensive good.
D) The MPL will fall in the production of both the labor- and capital-intensive goods.