A lower tariff on imported steel would most likely benefit A) ...

[madam-professor]

A lower tariff on imported steel would most likely benefit
 
  A) foreign producers at the expense of domestic consumers.
  B) domestic manufacturers of steel.
  C) domestic consumers of steel.
  D) workers in the steel industry.
  E) foreign consumers of steel.

Question 2

Compare and contrast the predictions of the Heckscher-Ohlin and classical models about likely trading partners of various countries with the predictions of the Linder hypothesis.
 
  What will be an ideal response?

[Ahnyah]

Answer to Question 1

C

Answer to Question 2

Both the classical and the HO models argue that the gains from trade emanate from different autarky relative prices. Consequently, differences in technology or factor endowments would seem to imply the possibility to exploit these gains. Linder argues that countries with similar standards of living (i.e. similar factor endowments or technologies) will produce similar types of goods and hence benefit by trading extensively, due largely to the availability through trade of an increased variety of goods.