The abundance of a particular factor of production in a country tends to make that factor:
A) more costly relative to the cost of the same factor in other countries.
B) more costly relative to other factors within the country.
C) less costly relative to the cost of the same factor in other countries.
D) very cheap in dollar terms.
E) All of the above

Question

Quizplus · Accepted Answer

The abundance of a particular factor of production in a country generally makes it less costly relative to the cost of the same factor in other countries, due to the principles of supply and demand. When a factor is abundant, its supply is high, which tends to lower its price compared to places where it is scarcer.

The Abundance of a Particular Factor of Production in a Country