In the specific factors model, which of the following will increase the quantity of labor used in cloth production?
A) an increase in the price of cloth relative to that of food
B) an increase in the price of food relative to that of cloth
C) a decrease in the price of labor
D) an equal percentage decrease in the price of food and cloth
E) an equal percentage increase in the price of food and cloth
A
You might also like to view...
The assumption of increasing opportunity costs in the HO model increases the likelihood that
A) there will be incomplete specialization in production after trade begins. B) countries will be better off with free international trade. C) countries will maximize their standards of living from free international trade. D) All of the above.
A country is said to be experiencing inflation when
A) prices of most goods and services are rising over time. B) prices of most goods and services are falling over time. C) total output is rising over time. D) total output is falling over time.