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Question 1 (1 point) In an HO model, suppose that two goods are produced: phones and watches. Phones are capital intensive while watches are labour intensive. Suppose that Thailand is labour-abundant while Canada is capital-abundant. Which of the following should occur when the two countries open to trade with each other? More than one choice is correct L/K increases in both sectors in Canada the relative price of phones should increase for Canada w/r decreases in Canada

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