Question: 1. According to the Heckscher-Ohlin model, two countries can equalize wage differences by either engaging in international trade in goods or allowing high-skilled and low-skilled labor to freely move between the two countries. Discuss whether this is true or false, and explain why.
2. According to the standard Heckscher-Ohlin model with two factors (capital and labor) and two goods, movement of Turkish migrants to Germany would decrease the amount of capitalintensive products produced in Germany. Discuss whether this is true or false, and explain why.