Multiple Choice
Suppose that the home country in the two-sector (manufacturing and agriculture) specific-factors model has a comparative advantage in manufacturing output. What will happen to the amount of land used in producing agricultural output when trade occurs?
A) It will fall.
B) It will rise.
C) It will not change.
D) It will first fall, then rise.
Correct Answer:
Verified
Correct Answer:
Verified
Q19: As relative prices in various industries change
Q20: If we assume only one factor (labor),
Q21: Which specific factor loses from trade?<br>A) one
Q22: The specific-factors model concludes that if there
Q23: In the two-sector (manufacturing and agriculture) specific-factors
Q25: As a general rule, when there are
Q26: Why must we know the composition of
Q27: In equilibrium, with diminishing marginal products, the
Q28: Some economists believe that an extended safety
Q29: If a nation begins to trade, it