Economics · International Trade Theories
Assertion (A): The Heckscher–Ohlin (H–O) theorem predicts that a capital-abundant country will export capital-intensive goods. Reason (R): Under the H–O model, factor price equalisation across trading partners is guaranteed even in the presence of trade impediments.
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Both A and R are true and R is the correct explanation of A
- 2Both A and R are true but R is not the correct explanation of A
- 3A is true but R is false✓
- 4A is false but R is true
Correct answer
A is true but R is false
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