Question
If the endowment of some resource increases,
the industry that uses that resource most intensively will increase its output while the other industry will decrease its output, was given by:Solution
The Rybczynski Theorem (RT) says that if the endowment of some resource increases, the industry that uses that resource most intensively will increase its output while the other industry will decrease its output. The relative factor intensity is measured by the ratio of factor use in each industry.
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