A shortcoming of the Heckscher-Ohlin model of international trade is that:
A) indifference curves can only be ranked ordinally; they do not reflect actual levels of welfare.
B) it reflects only the production side of the economy.
C) it only shows who gains and who loses when an economy shifts to free trade, not what the total gains in welfare are.
D) All of the above.
E) None of the above.
Correct Answer:
Verified
Q2: Compared to a hypothetical free trade equilibrium
Q3: Compared to a free trade equilibrium when
Q4: During the nineteenth century, transport costs:
A) fell
Q5: During the nineteenth century, price gaps:
A) shrank
Q6: The HO model assumes that when an
Q7: The HO model assumes that when an
Q8: When an economy shifts from no trade
Q9: When an economy shifts from no trade
Q10: The model that shows how the economy
Q11: Compared to the Heckscher-Ohlin model, all other
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