According to the Heckscher-Ohlin model
A) the gainers from trade could compensate the losers and still retain gains.
B) everyone gains from trade.
C) the scarce factor gains from trade and the abundant factor loses.
D) a country gains from trade if its exports have a high value added.
E) only the country with the more advanced technology gains from trade.

Question

Quizplus · Accepted Answer

The Heckscher-Ohlin model suggests that trade benefits the abundant factor of production in a country, while the scarce factor may lose. However, the overall gains from trade can be large enough that the gainers could potentially compensate the losers and still retain some benefits.

According to the Heckscher-Ohlin Model