According to the factor endowment model of Heckscher and Ohlin, countries heavily endowed with land will ?
Correct answer: C. Export products that are land-intensive
- A. Devote excessive amounts of resources to agricultural production
- B. Devote insufficient amounts of resources to agricultural production
- C. Export products that are land-intensive
- D. Import products that are land-intensive
Explanation
A country relatively abundant in land has a lower opportunity cost of producing land-intensive goods. It therefore tends to specialize in and export agricultural or other land-intensive products.
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Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.
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