Multiple Choice
France and Italy only trade with each other. Each produces wine and bread. The production of bread is relatively capital intensive, and the production of wine is relatively labor intensive. France is relatively abundant in capital, while Italy is relatively abundant in labor. According to the Heckscher-Ohlin model, what product(s) will Italy export?
A) bread
B) wine
C) neither bread nor wine
D) both bread and wine
Correct Answer:
Verified
Correct Answer:
Verified
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