1. The gravity model of trade implies that, all other things being equal, trade flows are proportional to the GDP of both countries and inversely proportional to the distance between them. 2. Look at the following table, which gives average product of labour in an imaginary two- good, two-country world: France Germany Cars 20 30 Wheat 50 50 In this scenario, France has comparative advantage in wheat production. 3. According to the Heckscher-Ohlin theorem, the very poorest countries will not be able to export anything, because they are not abundant in any factor.
1. The gravity model of trade implies that, all other things being equal, trade flows are proportional to the GDP of both countries and inversely proportional to the distance between them. 2. Look at the following table, which gives average product of labour in an imaginary two- good, two-country world: France Germany Cars 20 30 Wheat 50 50 In this scenario, France has comparative advantage in wheat production. 3. According to the Heckscher-Ohlin theorem, the very poorest countries will not be able to export anything, because they are not abundant in any factor.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
Question 1 2 and 3
Please help awnser question 1 2 and 3 For each question,please say whether the statement is true or false, and give a short explanation for your answer, with a diagram or example if needed.
![1.
The gravity model of trade implies that, all other things being equal, trade flows are
proportional to the GDP of both countries and inversely proportional to the distance
between them.
2.
Look at the following table, which gives average product of labour in an imaginary two-
good, two-country world:
France
20
Cars
Wheat
Germany
30
50
50
In this scenario, France has comparative advantage in wheat production.
3. According to the Heckscher-Ohlin theorem, the very poorest countries will not be able to
export anything, because they are not abundant in any factor.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fc40ff26c-acdf-4c64-9b1c-9da4f6acfc66%2F0cca007e-4013-4f87-82b7-87a2b7c9f5fc%2F36i50l_processed.png&w=3840&q=75)
Transcribed Image Text:1.
The gravity model of trade implies that, all other things being equal, trade flows are
proportional to the GDP of both countries and inversely proportional to the distance
between them.
2.
Look at the following table, which gives average product of labour in an imaginary two-
good, two-country world:
France
20
Cars
Wheat
Germany
30
50
50
In this scenario, France has comparative advantage in wheat production.
3. According to the Heckscher-Ohlin theorem, the very poorest countries will not be able to
export anything, because they are not abundant in any factor.
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
![ENGR.ECONOMIC ANALYSIS](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9780190931919/9780190931919_smallCoverImage.gif)
![Principles of Economics (12th Edition)](https://www.bartleby.com/isbn_cover_images/9780134078779/9780134078779_smallCoverImage.gif)
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
![Engineering Economy (17th Edition)](https://www.bartleby.com/isbn_cover_images/9780134870069/9780134870069_smallCoverImage.gif)
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
![ENGR.ECONOMIC ANALYSIS](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9780190931919/9780190931919_smallCoverImage.gif)
![Principles of Economics (12th Edition)](https://www.bartleby.com/isbn_cover_images/9780134078779/9780134078779_smallCoverImage.gif)
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
![Engineering Economy (17th Edition)](https://www.bartleby.com/isbn_cover_images/9780134870069/9780134870069_smallCoverImage.gif)
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
![Principles of Economics (MindTap Course List)](https://www.bartleby.com/isbn_cover_images/9781305585126/9781305585126_smallCoverImage.gif)
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
![Managerial Economics: A Problem Solving Approach](https://www.bartleby.com/isbn_cover_images/9781337106665/9781337106665_smallCoverImage.gif)
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
![Managerial Economics & Business Strategy (Mcgraw-…](https://www.bartleby.com/isbn_cover_images/9781259290619/9781259290619_smallCoverImage.gif)
Managerial Economics & Business Strategy (Mcgraw-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education