In the 2-factor, 2-good Heckscher-Ohlin model, trade will ________ the owners of a country's ________ factor and will ________ the good that uses that factor intensively.
A) benefit; abundant; export
B) harm; abundant; import
C) benefit; scarce; export
D) benefit; scarce; import
E) harm; scarce; export

Question

Quizplus · Accepted Answer

The Heckscher-Ohlin model predicts that trade benefits the owners of a country's abundant factor because the country will export goods that intensively use its abundant factor, taking advantage of its relative abundance to gain from trade.

In the 2-Factor, 2-Good Heckscher-Ohlin Model, Trade Will ________ the Owners