Economics · International Trade Theories
According to the Heckscher-Ohlin theory, which one of the following statements is correct?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Geographical proximity is the sole determinant of the pattern of international trade.
- 2A country benefits from international trade only if it has an absolute advantage in all goods.
- 3A country with a relatively abundant and cheaper cost of labor will export labor-intensive products.✓
- 4Trade takes place among countries primarily due to absolute differences in efficiency.
Correct answer
A country with a relatively abundant and cheaper cost of labor will export labor-intensive products.
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