Podcast
Questions and Answers
What does Factor Price Insensitivity (Leamer, 1995) in the H-O model highlight?
What does Factor Price Insensitivity (Leamer, 1995) in the H-O model highlight?
- The absence of zero-profit conditions in the determination of factor prices
- The occurrence of Factor Intensity Reversals (FIRs)
- The direct influence of factor endowments on factor prices
- The complex relationship between factor prices and factor endowments (correct)
What is one of the main questions the H-O model aims to answer?
What is one of the main questions the H-O model aims to answer?
- What is the impact of consumer preferences on international trade?
- How does technological change impact factor prices?
- What are the equilibrium factor prices? (correct)
- How does a change in government policies affect factor endowments?
According to the H-O model, what happens when Factor Intensity Reversals (FIRs) occur?
According to the H-O model, what happens when Factor Intensity Reversals (FIRs) occur?
- Goods become less competitive in the global market
- It simplifies the analysis and determination of factor intensities
- There is a direct link between factor prices and factor endowments
- The factor intensity rankings of goods change with changing factor prices (correct)
In the H-O model, what is assumed to be equalized across countries due to free trade?
In the H-O model, what is assumed to be equalized across countries due to free trade?
Which concept in the H-O model asserts that factor endowments have no direct impact on determining factor prices?
Which concept in the H-O model asserts that factor endowments have no direct impact on determining factor prices?
What effect does a steeper slope of the PPF relative to the relative price have in the H-O model?
What effect does a steeper slope of the PPF relative to the relative price have in the H-O model?
Which condition in the H-O model ensures that there is no involuntary unemployment or underutilization of labor and capital?
Which condition in the H-O model ensures that there is no involuntary unemployment or underutilization of labor and capital?
What is one of the outcomes when FIRs occur in the H-O model?
What is one of the outcomes when FIRs occur in the H-O model?
'Resources are limited' in the context of the H-O model implies what?
'Resources are limited' in the context of the H-O model implies what?
'FOC implies Equilibrium production occurs where the slope of the PPF equals the relative price' in the H-O model. What does FOC stand for?
'FOC implies Equilibrium production occurs where the slope of the PPF equals the relative price' in the H-O model. What does FOC stand for?
According to the Factor Price Equalization (FPE) theorem, under what conditions do factor prices become equal between two countries in free trade?
According to the Factor Price Equalization (FPE) theorem, under what conditions do factor prices become equal between two countries in free trade?
What does the Stolper-Samuelson Theorem suggest regarding the effect of an increase in the relative price of a good on factor returns?
What does the Stolper-Samuelson Theorem suggest regarding the effect of an increase in the relative price of a good on factor returns?
Which theorem predicts that an increase in a factor endowment will lead to an increase in output for the industry using that factor intensively?
Which theorem predicts that an increase in a factor endowment will lead to an increase in output for the industry using that factor intensively?
In a perfect specialization scenario according to the Heckscher-Ohlin (H-O) Model, what does each country export?
In a perfect specialization scenario according to the Heckscher-Ohlin (H-O) Model, what does each country export?
What is one of the factors that contribute to observed deviations from Factor Price Equalization (FPE) in practice?
What is one of the factors that contribute to observed deviations from Factor Price Equalization (FPE) in practice?
Which theory suggests that not everyone gains from trade when there is an increase in the relative price of a good?
Which theory suggests that not everyone gains from trade when there is an increase in the relative price of a good?
What does Leontief's paradox attempt to explain regarding international trade patterns?
What does Leontief's paradox attempt to explain regarding international trade patterns?
'Dutch disease' can be linked to which theorem based on the text provided?
'Dutch disease' can be linked to which theorem based on the text provided?
'Leontief's paradox' is explained by factors such as:
'Leontief's paradox' is explained by factors such as:
'Empirical tests of the H-O Model' require data related to:
'Empirical tests of the H-O Model' require data related to:
What is one reason countries trade according to the text?
What is one reason countries trade according to the text?
In the specific factors model, why does China export textiles according to the text?
In the specific factors model, why does China export textiles according to the text?
Why does Germany export machinery according to the text?
Why does Germany export machinery according to the text?
What does the H-O model show about trade patterns?
What does the H-O model show about trade patterns?
What determines the trade pattern in the H-O model?
What determines the trade pattern in the H-O model?
How does Samuelson contribute to the trade model discussed?
How does Samuelson contribute to the trade model discussed?
What differentiates countries in the H-O model?
What differentiates countries in the H-O model?
Why can China efficiently produce textiles according to the text?
Why can China efficiently produce textiles according to the text?
What is one reason for China's exports of textiles according to the text?
What is one reason for China's exports of textiles according to the text?
Flashcards are hidden until you start studying
