ch_5_test - Chapter 5 test...

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Unformatted text preview: Chapter 5 test Name___________________________________ MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) In the 2- factor, 2 good Heckscher- Ohlin model, the two countries differ in 1) _______ A) the size of their economies. B) military capabilities. C) tastes and preferences. D) labor productivities. E) relative abundance of factors of production. 2) If a country produces good Y (measured on the vertical axis) and good X (measured on the horizontal axis), then the absolute value of the slope of its production possibility frontier is equal to 2) _______ A) the cost of capital (assuming that good Y is capital intensive) divided by the cost of labor. B) the price of good X divided by the price of good Y. C) the price of good X divided by the price of good Y. D) the opportunity cost of good X. E) the opportunity cost of good Y. 3) In the 2- factor, 2 good Heckscher- Ohlin model, the production possibility frontier is kinked when 3) _______ A) a country does not engage in trade. B) there is no factor substitution in production. C) there are unemployed factor resources. D) the opportunity cost of production is constant. E) transportation costs are very high. 4) According to the Heckscher- Ohlin model,4) _______ A) only the country with the more advanced technology gains from trade. B) the gainers from trade could compensate the losers and still retain gains....
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This note was uploaded on 09/01/2011 for the course ECON 3150 taught by Professor Allalileeva during the Summer '09 term at York University.

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ch_5_test - Chapter 5 test...

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