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hi could u help me answer and solve these questions please: Consider first the specific-factors model with two countries (Home and Foreign} and two goods
hi could u help me answer and solve these questions please:
Consider first the specific-factors model with two countries (Home and Foreign} and two goods (cell phones and textiles). There are three factors of production in each country: Labour (denoted by L), capital specific to cell phone production (denoted by K), and capital specific to textile production (denoted by K7). Assume that: - In each industry, the marginal product of labour declines as the amount of labour used in the industry increases. - As the amount of capital goes up in an industry, marginal product of labour increases, whereas marginal product of capital decreases, and vice versa. - Home country has a comparative advantage in cell phone production and Foreign country has a comparative advantage in textile production. As a result, P. /PyStep by Step Solution
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