In less-developed countries the ________ effect leads to ________.

Name: In less-developed countries the ________ effect leads to ________.
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Question

Quizplus · Accepted Answer

The input-substitution effect occurs when firms in less-developed countries substitute capital for labor due to lower wages and higher capital costs. This leads to labor-intensive production, as capital-intensive methods are not cost-effective in these countries. Therefore, option A is the correct choice.

In Less-Developed Countries the ________ Effect Leads to ________

In Less-Developed Countries the Effect Leads to