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1. Suppose country A has KA = 120 units of capital and LA = 100 units of labor available. Suppose also that country B has KB = 200 units of capital and LB = 160 units of labor available. The two countries produce goods X and Y. We can say that a. country A is relatively capital abundant. b. country A is relatively labor abundant. c. good Y is relatively labor intensive. d. good X is relatively labor intensive. e. none of the above. 2. Consider the specic factors model. Suppose that a country produces automobiles (A) and boots (B). Suppose also that we have A-specic capital and B-specic capital. Also, assume that labor is mobile within a country. If the price of B increases, ceteris paribus, which of the following occurs? a. B capital owners are worse off. b. A capital owners are worse off. c. All workers are better off. d. The wage increase by the same percentage that the price of A increases. e. None of the above. 3. If the price of a Jaguar auto is 90,000 and the exchange rate between the dollar and the pound is e : #$ = 1.5 , then this Jaguar would cost how much in $s? 1 a. $135,000. b. $160,000. c. $60,000. d. $120,000. e. None of the above. 4. Think of the U.S. as the domestic country and Great Britain (GB) as the foreign country. Let \"Q\" stand for the domestic price of one unit of the foreign currency. If the exchange rate in New York were em = 1.25 and the exchange rate in London were 9L = 1.4, then the greatest amount of money you could covert $100 into with only two trades (and the procedure by which you would do it) would be a. $165, by buying s in \"rst and then selling them back for $s in L. b. $165, by buying s in L rst and then selling them back for 33s in NY. c. $112, by buying s in \"rst and then selling them back for $s in L. d. $1 12, by buying s in L rst and then selling them back for $s in NY. e. none of the above