Question 1 Look at the table below. Physical Capital Researchers Skilled Unskilled GDP Labor Labor USA 25 26 27 2 China 10 17 8 18 Japan 12 11 5.8 2 226 20 15 India 4 3 6 30 5 Germany 8 6 3 1 4.5 In the table above each number represents a country's share in the world endowment of a factor production or GDP. For example, number 25 in the row for USA and the column for Physical Capital says that the US owns 25% of the world endowment of physical capital. Based on these numbers and your knowledge of the Heckscher-Ohlin model, answer the following questions. a) Which countries should be exporting the services of Physical capital? b) Which countries should be importing the services of Researchers? c) Which countries should be exporting the services of skilled labor? d) Which countries should be exporting the services of unskilled labor? Question 2 k According to the Heckscher-Ohlin model with 2 goods and 2 factors (capital and labor), the movement of Mexican migrants to the US would increase the production of the labor-intensive goods in the US. True or False? Which theorem would you use to answer this question? Suppose the US is a closed economy. What should be the impact of this migration on the relative price of the labor-intensive good? What should happen to the relative and real reward of labor in the US?
Question 1 Look at the table below. Physical Capital Researchers Skilled Unskilled GDP Labor Labor USA 25 26 27 2 China 10 17 8 18 Japan 12 11 5.8 2 226 20 15 India 4 3 6 30 5 Germany 8 6 3 1 4.5 In the table above each number represents a country's share in the world endowment of a factor production or GDP. For example, number 25 in the row for USA and the column for Physical Capital says that the US owns 25% of the world endowment of physical capital. Based on these numbers and your knowledge of the Heckscher-Ohlin model, answer the following questions. a) Which countries should be exporting the services of Physical capital? b) Which countries should be importing the services of Researchers? c) Which countries should be exporting the services of skilled labor? d) Which countries should be exporting the services of unskilled labor? Question 2 k According to the Heckscher-Ohlin model with 2 goods and 2 factors (capital and labor), the movement of Mexican migrants to the US would increase the production of the labor-intensive goods in the US. True or False? Which theorem would you use to answer this question? Suppose the US is a closed economy. What should be the impact of this migration on the relative price of the labor-intensive good? What should happen to the relative and real reward of labor in the US?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
please help me with 1 and 2. Thank you
Transcribed Image Text:Question 1
Look at the table below.
Physical
Capital
Researchers Skilled
Unskilled GDP
Labor
Labor
USA
25
26
27
2
China
10
17
8
18
Japan
12
11
5.8
2
226
20
15
India
4
3
6
30
5
Germany 8
6
3
1
4.5
In the table above each number represents a country's share in the world endowment of a factor
production or GDP. For example, number 25 in the row for USA and the column for Physical
Capital says that the US owns 25% of the world endowment of physical capital. Based on these
numbers and your knowledge of the Heckscher-Ohlin model, answer the following questions.
a) Which countries should be exporting the services of Physical capital?
b) Which countries should be importing the services of Researchers?
c) Which countries should be exporting the services of skilled labor?
d) Which countries should be exporting the services of unskilled labor?
Question 2 k
According to the Heckscher-Ohlin model with 2 goods and 2 factors (capital and labor), the
movement of Mexican migrants to the US would increase the production of the labor-intensive
goods in the US. True or False? Which theorem would you use to answer this question? Suppose
the US is a closed economy. What should be the impact of this migration on the relative price of
the labor-intensive good? What should happen to the relative and real reward of labor in the US?
Expert Solution
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
Recommended textbooks for you
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
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)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
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-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education