Assume that corn and cloth are each produced using both land and labor in a country. Corn is relatively land-intensive. If the country experiences an increase in its endowment of labor, product prices remaining unchanged, the Rybczynski theorem will predict that the production of corn will decline.

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According to the Rybczynski theorem, if a country experiences an increase in the endowment of a factor, it will increase the production of the good that uses that factor intensively and decrease the production of the other good. Since corn is land-intensive and labor has increased, cloth production (labor-intensive) will increase, leading to a decline in corn production.

Assume That Corn and Cloth Are Each Produced Using Both