Consider the Heckscher-Ohlin model. Let the domestic economy be labour abundant and the foreign economy capital abundant.

{5} a. Assume plague wipes out part of the domestic population. In the box diagram show the etfect on the allocation of L to the domestic C sector. assume initial prices of C and F are unchanged. {5} b. Independent of {a} suppose productivity of labour in C production rises in the foreign economy. In the ELFRS diagram show the resulting effect on E. Assume world BS is halfway between domestic and foreign RS. (5} c. Fbr the shock in [b] explain the effect on world trade of C in a sentence. (5} d. For the shock in [b] analyse the impact on the nominal wage rate worldwide under Factor Price Equalization. {5} =1. In the Specic Factors labour market model show the effects on the domestic wage and labour allocation to M production when oods remove signicant parts of land from cultivation