Question: 1. Consider a Specific Factors Model in which labour is the mobile factor, and land and capital are the specific factors. Then, as result of
1. Consider a Specific Factors Model in which labour is the mobile factor, and land and capital are the specific factors. Then, as result of inward FDI, the following changes in the incomes of workers, landowners, and domestic capitalists are possible: (a) Workers gain 20, landowners gain 10, and domestic capitalists gain 20. (b) Workers lose 10, landowners lose 10, and domestic capitalists gain 30. (c ) Workers gain 20, landowners lose 10, and domestic capitalists gain 20. (d) Workers gain 30, landowners gain 20, and domestic capitalists lose 20. (e ) None of the above.
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