The conclusion that international trade will lead to an increase in real earnings of a country's abundant resource is known as:
a. factorintensity reversal.
b. the HeckscherOhlin model.
c. Riparian comparative advantage.
d. the StolperSamuelson theorem.
Ans: d. the StolperSamuelson theorem.
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Assume that goods X and Y are not Giffen goods. If the price of good X falls, a consumer will definitely
a. consume more of good X because her budget constraint has rotated outward. b. consume more of good X because her budget constraint has shifted outward. c. consume more of good Y because her budget constraint has rotated outward. d. consume more of good Y because her budget constraint has shifted outward.
In a simple macroeconomic model, only one component of expenditures is allowed to change:
A. investment. B. consumption. C. net exports. D. government spending. E. transfer payments.