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Solution Library
Factor Endowments and Allocation of Factors of Production
Question
Consider the following table of factor endowments:
Countries
Factor Endowments U.S. Canada
Labor force (in millions of workers) 100 25
Capital stock (in thousands of machines) 30 15
a.) Which country is relatively abundant in capital?
b.) Which country is relatively abundant in labor?
c.) Suppose that Zambonis are labor intensive and field goal posts are capital intensive. Which country will have comparative advantage in, and thus export, field goal posts? Explain.
Summary
The question belongs to Economics and it is about abundance factor endowments in the countries of US and Canada. The labor force and capital stock of these two countries are considered for a work which requires a combination of labor intensive and capital intensive.
Total Word Count 83
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