Review the Heckscher Ohlin model (\ before starting this problem. Once again rewrite the last six digits of your student ID number

_9__8__5__8__9__7_

This time characterize each number as Odd or Even below (let the number 0 be Even)

__Odd___ (A)__Even___(B)_Odd__(C)__Even_(D)__Odd___(E)__Odd___(F)

(Example: If you ID is 0490715 the last six digits are 490715.You would then write Even (A) Odd (B)Even (C)Odd (D)Odd(E)Odd(F)

Use the letters as follows

If A is Even - Home;Odd - Foreign;

If B is Even - Foreign; Odd - Home(we won't use B below)

If C is Even - Labour: Odd - Capital

If D is Even - Land;Odd - Energy

If E is Even - Food;Odd - Cloth

If F is Even - Increase;Odd - Decrease

(example: Hence given the ID 0490715 we would have

A - Home, B - Foreign (Not used), C - Labour, D - Energy, E - Cloth, F - Decrease)

Assume a Heckscher Ohlin (H-O) model with "large" countries for this problem.Four problems test your knowledge of the main results of the H-O model.In each problem state which of the four main trade theorems of the H-O model of trade best pertains to the problem.Explain your reasoning for your answers

You will find it easier to fill in the blanks of each part of the problem statement using your ID number as above and then working on the problem.

Record your answers in the spaces (__________________) provided and provide an explanation for your answer if you are asked.

a) Food and cloth are both produced in Home and Foreign. Determine the equilibrium price of ___________(C) and ___________(D) if it takes 3 units of __________(C) and 4 units of ______________(D) to produce 1 unit of_______(E)in __________(A). Assume it takes 2 units of ___________(C) and 1 unit of __________(D) to produce 1 unit of the other good, _________, in _________(the country other than A).Let Home and Foreign trade with one another.Let the equilibrium world price of ________(E) be 30 and the price of the other good, ____________, be 15.Determine factor prices assuming competitive markets. (Obviously show your work!)

Price of ___________(C) = ______________

Price of ___________(D) = ______________

Relevant trade theorem used in answering problem _________________________

Why?