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Sandvor and Milese Specialize in the Production of Dairy and Textiles

Question 73

Multiple Choice

Sandvor and Milese specialize in the production of dairy and textiles respectively. While Sandvor doesn't produce textiles, Milese is not as technologically advanced as Sandvor. In this situation, according to the Heckscher-Ohlin theory,


A) Sandvor will import textiles from Milese and export dairy to it.
B) Sandvor will invest more than Milese in the production of textiles to exploit its comparative advantage.
C) Sandvor and Milese will raise their trade barriers to protect their economies.
D) Milese will recruit experts from Sandvor to specialize in the production of dairy.
E) Sandvor will recruit workers from Milese to improve its standing in the textile industry.

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