A deterioration of a nation's terms of trade causes the nation's welfare to:

. The H-O model extends the classical trade model by:

. Which is not an assumption of the H-O model:

With equal technology nations will have equal K/L in production if:

. We say that commodity Y is K-intensive with respect to X when:

. When w/r falls, L/K

. A nation is said to have a relative abundance of K if it has a:

A difference in relative commodity prices between nations can be based on a diffe rence in:

. In the H-O model, international trade is based mostly on a difference in:

. According to the H-O model, trade reduces international differences in:

According to the H-O model, international trade will:

. The H-O model is a general equilibrium model because it deals with:

The H-O model is a simplification of the a truly general equilibrium model because it deals with:

The Leontief paradox refers to the empirical finding that U.S.

From empirical studies, we conclude that the H-O theory: