Question

The Trade Gravity Model predicts that the volume of trade between two countries increases with the product of the GDP of the two countries and inversely with distance. This prediction is most consistent with: g

Answer 1

The HOS model

Step-by-step explanation:

Heckscher Ohlin model is the economic model which assumes that there are two countries with two goods and two factors. These countries can trade easily in the market without any barrier. This model explains the pattern of trade of the two countries who wishes to trade the goods they produce in their home country.