Asked by Alexandra Rosen on Jun 03, 2024
Verified
Which model states that nations that are abundant in a factor will have a comparative advantage in a good whose production is intensive in that factor?
A) the pauper labor fallacy model
B) the Ricardian model
C) the Heckscher-Ohlin model
D) the oligopoly model
Heckscher-Ohlin Model
An economic theory that proposes countries will export products that utilize their abundant and cheap factors of production and import products that require factors of production that are scarce and expensive domestically.
Comparative Advantage
The ability of an individual or group to carry out a particular economic activity more efficiently than another activity.
- Fathom the influence of factor endowments in the identification of comparative advantage.
- Recognize the economic theories explaining international trade, including the Heckscher-Ohlin model.
Verified Answer
Learning Objectives
- Fathom the influence of factor endowments in the identification of comparative advantage.
- Recognize the economic theories explaining international trade, including the Heckscher-Ohlin model.
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