When one applies the Heckscher-Ohlin model of trade to the issue of trade-related income redistributions, one must conclude that North South trade, such as U.S.-Mexico trade,
A) must help low skill workers on both sides of the border.
B) is likely to hurt high-skilled workers in the U.S.
C) is likely to involve higher overall national economic gains that will be greater than any harm done to low-skilled workers in the U.S.
D) is likely to hurt low-skilled workers in Mexico.
E) gives no advantage to the workers in either country.
C
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Economic fluctuations: a. are linked, but not perfectly synchronized, across countries
b. are perfectly synchronized across countries. c. in one country are independent of fluctuations in other countries. d. in the United States always occur after fluctuations in other developed economies. e. in the United States usually occur before fluctuations in other developed economies.
The self-correcting tendency of the economy means that falling inflation eventually eliminates:
A. exogenous spending. B. recessionary gaps. C. expansionary gaps. D. unemployment.