Nemedia and Aquilonia have just started to trade with each other.Nemedia exports goods produced with skilled labour and imports goods made with unskilled labour from Aquilonia.Over time,what would we expect will happen to the wages of skilled and unskilled labour in Nemedia
A)The wages of skilled labour in Nemedia will rise, and the wages of unskilled labour in Nemedia will fall.
B)The wages of skilled labour in Nemedia will fall, and the wages of unskilled labour in Nemedia will rise.
C)The wages of skilled labour in Nemedia will rise, and the wages of unskilled labour in Nemedia will rise.
D)The wages of skilled labour in Nemedia will fall, and the wages of unskilled labour in Nemedia will fall.

Question

Quizplus · Accepted Answer

As Nemedia exports goods produced with skilled labor, the demand for skilled labor will increase, leading to higher wages. Conversely, as Nemedia imports goods made with unskilled labor, the demand for unskilled labor will decrease, leading to lower wages.

Nemedia and Aquilonia Have Just Started to Trade with Each