Hi, I am currently studying with assessment questions for my upcoming exam. At this point I have written a few and in my opinion they were good. But I really struggle with this one. I hope that you can help me. Thank you in advance!

Consider a world in which all assumptions of the 2-2-2 Heckscher-Ohlin model apply. The two countries in the model are France and South-Africa, the two goods in the model are X and Y, and the two production factors in the model are low-skilled labour (L) and high-skilled labour (H). Furthermore, France is relatively well-endowed with H and Y is the H-intensive good. Initially, France and South-Africa do not trade with each other.

Use this information to assess the consequences for low-skilled workers in France when the two countries engage in free trade with one another. While making your assessment you are required:

• to give a graphical presentation of the initial, no trade (autarky) situation for both countries by means of a graph.
• to use this graph to illustrate the effects of moving from no trade to free trade on prices, factor rewards and factor intensities in France;
• to give a clear concluding statement of your overall assessment of the effects of the opening up to trade for low-skilled workers in France;
• to indicate how your assessment on the effects on low-skilled labour in France would change if you would assume that low-skilled labour is sector specific.