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In: Economics

) State the Heckscher-Ohlin (H-O) Theorem, and explain what it means. What are the initial assumptions?...

) State the Heckscher-Ohlin (H-O) Theorem, and explain what it means. What are the initial assumptions? Use diagrams with PPFs, indifference curves, and price lines to demonstrate the H-O theorem and to show the existence of (A) Comparative advantage and (B) Gains from trade. What happens to the production of each good in each country under free trade as opposed to autarky?

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