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 return to capital and the return to land in the recipient nation?

A) The returns to land and capital will both decrease.
B) The return to land will decrease; the return to capital will increase.
C) The return to land will increase; the return to capital will decrease.
D) The returns to land and capital will both increase.