Suppose that the wage is $20 per hour in a twosector
(manufacturing and agriculture) specificfactors model.
Currently, the prices of manufactured and agricultural
Outputs are $5 and $1, respectively; the marginal
Product of labor in the manufactured sector is 6 units
Per hour; and the marginal product of labor in the
Agricultural sector is 10 units per hour.What will happen
To the distribution of labor between the two sectors?
A) Nothing will happen.The current allocation of labor between the two sectors is ideal.
B) The manufacturing sector will demand more labor, and the agricultural sector will demand less labor at the
Current wage.
C) The agricultural sector will demand more labor, and the manufacturing sector will demand less labor at the
Current wage.
D) Both the agricultural and the manufacturing sector will demand more labor at the current wage.
Correct Answer:
Verified
Q34: Suppose that the Home country in the
Q35: As a nation increases its production of
Q36: Consider the following information for a hypothetical
Economy:
Q37: In the twosector (manufacturing and agriculture)
Specificfactors model,
Q38: If a nation begins to trade, it
Q40: When a nation engages in no trade
Q41: In the specificfactors model, suppose that a
Q42: When the demand for products competing with
Q43: Workers displaced because of trade:
A)have had larger
Q44: An increase in demand for resources fixed
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