Starting from an autarky (no-trade) situation with Heckscher-Ohlin model, if Country H is relatively labor abundant, and its trading partner is relatively land abundant, then once trade begins ___________. a. wages should rise and rents should fall in H. b. wages and rents should fall in H. c. wages should fall and rents should rise in H. d. wages and rents should rise in H. e. rent will be unchanged but wages will rise in H.

Respuesta :

Answer:

Answer is A) wages should rise and rents should fall in H.

Refer below for explanation.

Explanation:

Therefore,

Starting from an autarky (no-trade) situation with Heckscher-Ohlin model, if Country H is relatively labor abundant, and its trading partner is relatively land abundant, then once trade begins wages should rise and rents should fall in H.