Suppose that Home has 20% of the world's capital, 10% of the world's skilled labor, and 30% of the world's unskilled labor and produces 20% of the world's GDP. What does this information suggest?
A) only that Home is capital abundant
B) only that Home is skilled-labor abundant
C) only that Home is abundant in unskilled labor
D) Home is not abundant in capital, skilled labor, or unskilled labor.

Question

Quizplus · Accepted Answer

Given the proportions of world resources and GDP, Home is only abundant in unskilled labor (30% of the world's unskilled labor) compared to its share of the world's GDP (20%). The shares of capital (20%) and skilled labor (10%) are either equal to or less than its GDP share, not indicating abundance in those factors.

Suppose That Home Has 20% of the World's Capital, 10