If the Heckscher-Ohlin theorem is valid in practice (and assuming that capital and laborAre treated as the only two factors in the real world), then the "Leontief statistic" for aLabor-abundant country would be __________.
A) greater than 1.0
B) equal to 1.0
C) less than 1.0 but greater than zero
D) less than zero

Question

Quizplus · Accepted Answer

According to the Heckscher-Ohlin theorem, a labor-abundant country will have a comparative advantage in producing and exporting labor-intensive goods. This means that the country's production will use relatively more labor than capital, making the Leontief statistic (the ratio of capital to labor input in production) greater than 1.0.

If the Heckscher-Ohlin Theorem Is Valid in Practice (And Assuming