The two-sector (manufacturing and agriculture) specific-factors model is termed a "short-run" model because:
A) labor cannot move from one activity to another.
B) land resources can move from one activity to another.
C) labor can move from one activity to another.
D) land and capital cannot move from one activity to another.

Question

Quizplus · Accepted Answer

In the two-sector specific-factors model, it is considered a "short-run" model because factors such as land and capital are fixed in the short run and cannot move between sectors (manufacturing and agriculture), while labor is mobile and can move between sectors.

The Two-Sector (Manufacturing and Agriculture) Specific-Factors Model Is Termed a "Short-Run