Question: How would you go about setting up this problem? Given the following information :The world has two countries (A and B) and two production factors
How would you go about setting up this problem?
Given the following information:The world has two countries (A and B) and two production factors (land and labor).Country A has 600 land and Country B has 900 land, and Country A has 200 labor and Country B has 400 labor.
Statement to evaluate:According to the Heckscher-Ohlin model, a shift from no trade to free trade will result in a decrease in the rental rate earned by owners of land in Country B.
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