Assume that Country A is relatively abundant in labor and Country B is relatively abundant in land Note that wages are the returns to labor and rents are the returns to land According to the factor price equalization theorem, once Country A begins specializing according to comparative advantage and trading with Country B: A. wages and rents should fall in Country A B. wages and rents should rise in Country A C. wages should rise and rents should fall in Country A D. wages should fall and rents should raise in Country A ?

Related Mcqs:

1. According to the factor price equalization theorem, the ________ factor should oppose free. trade policies in any given country?

   A. abundant B. scarce C. neither D. can’t tell without more information...

2. The Heckscher-Ohlin theorem states that a country will have comparative advantage in the good whose production in relatively intensive in the with which the country is relatively abundant ?

   A. tastes B. technology C. factor/resource D. opportunity cost...

3. _____ 1954 study of U.S trade patterns showed that U.S exports were labor-intensive compared with U.S imports, even though the United States was widely regarded as a relatively capital-abundant nation ?

   A. Paul Samuelson’s B. Wolfgang Stolpher’s C. Staffan Linder’s D. Wassily Leontief’s...

4. Since the supply of undeveloped land is relatively inelastic a tax on undeveloped land would generate ?

   A. a small deadweight loss and the burden of the tax would fall on the renter B. a large deadweight loss and the burden of the tax would fall on the landlora C. a large deadweight loss and the burden of the tax would fall on the renter. D. a small deadweight loss and the...

5. Assume that global recession causes the quantity of tin demanded to decrease by 4 million pounds at each price To maintain the price of tin at the target price you would ?

   A. sell 4 million pounds of tin B. sell 8 million pounds of tin C. buy 4 million pounds of tin D. buy 8 million pounds of tin...

6. Instead, assume that global economic expansion causes the quantity of tin demanded to increase by 4 million pounds at each price To maintain price of tin at the target price you would ?

   A. sell 4 million pounds of tin B. sell 8 million pounds of tin C. buy 4 million pounds of tin D. buy 8 million pounds of tin...

7. _______ states that as real GNP per capita rises, people demand relatively more social goods and relatively fewer private goods?

   A. incomes policy B. Moral hazard C. Wagner’s law D. Fiscal policy...

8. Suppose the price level falls but suppliers only notice that the price of their particular product has fallen Thinking there has been a fall in the relative price of their product they cut back on production, This is a demonstration of the ?

   A. misperceptions theory of the short run aggregate supply curve B. classical dichotomy theory of the short run aggregate supply curve C. sticky price theory of the short run aggregate supply curve D. sticky wage theory of the short run aggregate supply curve...

9. Suppose that at a price of Rs 30 per month there are 30000 subscribers to cable television in small Town. If small Town Cablevision raises its price Rs40 per month the number of subscribers will fall to 20000 Using the midpoint method for calculating the elasticity what is the price elasticity of demand for cable TV in Small Town ?

   A. 1.4 B. 0.66 C. 0.75 D. 2.0...

10. Suppose that at a price of Rs 30 per month there are 30000 subscribers to cable television in small Town. If small Town Cablevision raise its price to Rs 40 per month the number of subscribers will fall to 20000 At which of the following price does small Town Cablevision earn the greatest total revenue ?

    A. Rs 0 per month B. Rs 30 per month C. Rs 40 per month D. Either Rs 30 or Rs 40 per month because the price elasticity of demand is 1.0...