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Suppose that there are two production factors, capital and land, and that the United States is relatively land-abundant while the European Union is relatively capital-abundant.
Suppose that there are two production factors, capital and land, and that the United States is relatively land-abundant while the European Union is relatively capital-abundant. According to the Heckscher-Ohlin model,
a) All capitalists in both countries should support free trade.
b) European capitalists should support US-European free trade.
c) European landowners should support US-European free trade.
Choose a, b, or c
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