Heckscher Ohlin Model Quizzes, Questions & Answers

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Model Quiz 4

Model Quiz 4 explores the Heckscher-Ohlin model, focusing on trade impacts, differences from the Ricardian model, and income redistribution. It assesses understanding of economic theories shaping global trade patterns, suitable...

Questions: 16 | Attempts: 683 | Last updated: Mar 22, 2025

Sample Question 1
In the Heckscher-Ohlin model, trade cannot make a country as a whole worse off because

Trade restrictions increase when imports increase.

The autarky level of production and consumption is still available.

Of the assumption that exports exceed imports

Those who gain from trade can compensate those who lose from trade.

Of the assumption that tariffs increase the welfare of both producers and consumers

Sample Question 2
What is the main difference between the Heckscher-Ohlin model and the Ricardian model?

Unlike in the Ricardian model, endowments of factors of production affect trade patterns in the Heckscher-Ohlin model.

Unlike in the Ricardian model, factors are mobile across countries in the Heckscher-Ohlin model.

Unlike in the Ricardian model, all factors of production gain as a result of trade in the Heckscher-Ohlin model.

Unlike in the Ricardian model, trade is not assumed to be free in the Heckscher-Ohlin model.

Unlike in the Ricardian model, factors are mobile across industries in the Heckscher-Ohlin model

Sample Question 3
If cloth production is labor intensive and food production is land intensive, what would be the result of a decrease in the price of food in the Heckscher-Ohlin model?

The real wage will rise in terms of both goods, and the real income of land owners will fall in terms of food and rise in terms of cloth.

The real wage will fall in terms of both goods, and the real income of land owners will rise in terms of both goods.

The real wage will rise in terms of both goods, and the real income of land owners will fall in terms of both goods.

The real wage will rise in terms of both goods, and the real income of land owners will rise in terms of food and fall in terms of cloth.

The real wage will rise in terms of both goods, and the real income of land owners will rise in terms of both goods