There are two countries, China and Luxembourg, two factors of production, land, T, and labor, L , and two goods, cloth and wheat. The production functions, which are identical across countries are: Q : L0.75TU.25 C C C _ 0.2 0.3 QW Lf Tf where is the amount of labor used in industry I, is the amount of L. 1 1; land used in industry . and is the amount of good . produced. I Qi 1 China has 1 billion people and Luxembourg has 460 thousand people. China has 9,600,000 sq. km of land, while Luxembourg has 2,600 sq. km of land. a. Which good is land-intensive? Which good is labor-intensive? (3 pts.) b. Under free trade, which country would export wheat? Which country would export cloth? (6 pts.) c. When China moves from a closed economy to free trade, what happens to the incomes of land owners? What happens to the incomes of laborers? (5 pts.) d. Generalize your answer from part c. What happens to the returns of scarce and abundant factors when a country opens to trade? (6 pts.)