In the specific model with two consumption goods and labour (mobile) and land and capital (specific factors), in Home compared to autarky the market equilibrium with free trade of goods O the profit of the land owners increases. O the price for capital cannot be lower. O the economy does not achieve a Pareto improvement. O capital owners are better off if the price for good produced using capital is higher. O consumption is higher. O labour is less productive O a good that is improted has lower price.

In the specific model with two consumption goods and labour (mobile) and land and capital (specific factors), in Home compared to autarky the market equilibrium with free trade of goods O the profit of the land owners increases. O the price for capital cannot be lower. O the economy does not achieve a Pareto improvement. O capital owners are better off if the price for good produced using capital is higher. O consumption is higher. O labour is less productive O a good that is improted has lower price.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter13: General Equilibrium And Welfare

Section: Chapter Questions

Problem 13.3P

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