Factor Endowments and Comparative Advantage Quiz
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Factor Endowments and Comparative Advantage Quiz

Test your understanding of international economics with this quiz on factor endowments and the Heckscher-Ohlin theory. Explore how comparative advantage is linked to differences in factor endowments and how trade influences relative factor prices between nations.

Created by
@BrotherlyQuartz355

Questions and Answers

According to the Heckscher-Ohlin theory, how many factors of production are considered in the model?

Two

What is the basis of comparative advantage in the context of international trade?

Differences in factor endowments across nations

In the Heckscher-Ohlin theory, how many goods are considered in the model?

Two

How does international trade impact relative factor prices within and across nations?

<p>It affects relative factor prices</p> Signup and view all the answers

According to the Heckscher-Ohlin theory, what is assumed about the technology in both nations?

<p>It is the same in both nations</p> Signup and view all the answers

According to the Heckscher-Ohlin theory, how many nations are considered in the model?

<p>One nation</p> Signup and view all the answers

What is assumed about the technology in both nations in the Heckscher-Ohlin theory?

<p>Technology is the same in both nations</p> Signup and view all the answers

In the Heckscher-Ohlin theory, how many factors of production are considered in the model?

<p>Two factors of production</p> Signup and view all the answers

How does international trade impact relative factor prices within and across nations according to the Heckscher-Ohlin theory?

<p>It equalizes relative factor prices</p> Signup and view all the answers

What is the basis of comparative advantage in the context of international trade according to the Heckscher-Ohlin theory?

<p>Differences in factor endowments</p> Signup and view all the answers

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