Introducing transport cost in the Heckscher-Ohlin model will lead to which of the following predictions: (i)...

  

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Introducing transport cost in the Heckscher-Ohlin model will lead to which of the following predictions: (i) (ii) (iii) (iv) (v) Each country will export the product that uses its scare factor of production relatively intensively. Factor prices converge Product prices equalize Each country will import the product that uses its scare factor of production relatively intensively. None of the HO model predictions hold anymore A. (i) and (iii) only. B. (ii) and (iv) only. C. (ii), (iii) and (iv) only. D. (iii) and (iv) only. E. (v) only. Introducing transport cost in the Heckscher-Ohlin model will lead to which of the following predictions: (i) (ii) (iii) (iv) (v) Each country will export the product that uses its scare factor of production relatively intensively. Factor prices converge Product prices equalize Each country will import the product that uses its scare factor of production relatively intensively. None of the HO model predictions hold anymore A. (i) and (iii) only. B. (ii) and (iv) only. C. (ii), (iii) and (iv) only. D. (iii) and (iv) only. E. (v) only.

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