In the specific factors model,a country's production function is ________ because of ________.
A) a straight line; diminishing marginal returns
B) a curved line; diminishing marginal returns
C) a straight line; constant marginal returns
D) a curved line; constant marginal returns
E) a curved line; a limited supply of labor

Question

Quizplus · Accepted Answer

In the specific factors model, a country's production function is a curved line due to diminishing marginal returns. This occurs as more inputs are added to production, resulting in smaller and smaller increases in output. The specific factors model assumes that there are fixed factors of production, such as land or capital, that cannot be easily transferred between industries, leading to different production functions for each industry. Therefore, the production function is not a straight line, and the correct answer is B.

In the Specific Factors Model,a Country's Production Function Is ________