The table below shows the quantity demanded (in thousands) and quantity supplied (in thousands) of computers in the U.S. and Canada at different prices.Table 20.5

-The original comparative advantage model that used the relative abundance of factors of production to explain comparative advantage assumed that countries:

Question

The table below shows the quantity demanded (in thousands) and quantity supplied (in thousands) of computers in the U.S. and Canada at different prices.Table 20.5
 
-The original comparative advantage model that used the relative abundance of factors of production to explain comparative advantage assumed that countries:

Quizplus · Accepted Answer

The original comparative advantage model assumed that countries employed only two factors of production; namely, labor and capital. This was based on the assumption that land and entrepreneurship were not very mobile across international borders during the time the model was developed. The model also assumed that the capital stock was fixed and could not be varied, which meant that the only factor of production that could be adjusted to achieve efficiency was labor.

The Table Below Shows the Quantity Demanded (In Thousands) and Quantity