The degree of a factor's specificity is inversely related to
A) the amount of time required to redeploy the factor to a different industry.
B) factor quality, with lower quality factors having a lower level of specificity.
C) the cost of the factor as a proportion of the long-run total cost of production.
D) the mobility of the factor, with more mobile factors having less specificity.
E) technology differences between two countries, with a less advanced technology resulting in less factor specificity.

Question

Quizplus · Accepted Answer

The degree of specificity of a factor is inversely related to its mobility. This means that more mobile factors will have less specificity, while less mobile factors will have higher specificity. Factors that are specific to an industry or product are less mobile and require a longer time to redeploy to a different industry, which makes them more specific.

The Degree of a Factor's Specificity Is Inversely Related to