In contrast to the Ricardian model, international trade in
The specificfactors model:
A)will lead to gains for all resources.
B)will lead to losses for all resources
C)will lead to gains for some resources and losses for other resources.
D)will not cause changes in the returns of any resources.

Question

In contrast to the Ricardian model, international trade in
The specific­factors model:
A)will lead to gains for all resources.
B)will lead to losses for all resources
C)will lead to gains for some resources and losses for other resources.
D)will not cause changes in the returns of any resources.

Quizplus · Accepted Answer

The specific-factors model suggests that trade will lead to gains for the specific factors (resources that are specialized in a specific sector) and losses for the other factors (resources that are not specialized in that sector). Therefore, trade will lead to gains for some resources and losses for other resources.

In Contrast to the Ricardian Model, International Trade in