9.After trade liberalization, the short-run impact on the specific factor that is relatively scarce is: a.No change in its real income. b.A decrease in its real income. c.An increase in its real income. d.Indeterminate change in its real income without more information.
10.Assume that strawberry production requires the specific factor of land, that tractor production requires the specific factor of capital, and that labor is a mobile factor that can be used in either industry. If the U.S. is capital abundant while Mexico is land abundant, then according to the specific factors model, the opening of international trade between the U.S. and Mexico would, in the short-run: