Chap009

Chap009 - Chapter 09 - Empirical Tests of the Factor...

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Chapter 09 - Empirical Tests of the Factor Endowments Approach Chapter 09 Empirical Tests of the Factor Endowments Approach Multiple Choice Questions 1. Suppose that, in a real-world situation, a labor-abundant country's tariffs and nontariff barriers are levied relatively more heavily on labor-intensive goods than on capital-intensive goods. In this situation, a Leontief two-factor test would, other things equal, be the country's adherence to the Heckscher-Ohlin trade pattern, in comparison with a situation where trade barriers were absent. A . Biased toward confirming b. Biased against confirming c. Unbiased in its finding concerning d. Biased toward confirming, biased against confirming, or unbiased in its finding concerning - cannot be determined without more information 2. In the production process of a final good industry, the direct factor requirements per unit of output will be __________ the total factor requirements per unit of output; if the industry is relatively capital-intensive when classified by direct requirements, it __________ be relatively capital-intensive when classified by total requirements. a. Greater than; must also b. Greater than; may not necessarily c. Less than; must also D . Less than; may not necessarily 3. If increased Heckscher-Ohlin-type trade were the major factor leading to increased income inequality in the United States, then one would expect that the relative prices of skilled labor- intensive goods to unskilled labor-intensive goods would have __________ and that nontraded goods industries would have __________ their use of unskilled labor relative to
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Chap009 - Chapter 09 - Empirical Tests of the Factor...

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