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61 Suppose that we are in a two-factor, two-country world where the factors of production are labor (L) and land (T), the ret
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61) c. (L/T)A>(L/T)B;(w/t)A>(w/t)B; Since country A is land abundant, the ratio of L/T in country A is higher compared to country B. Similarly, the rental rate on land would be lower in country A as compared to country B because of land-abundance. Hence, the ratio, w/t is higher in country A as compared to country B.

62) a. factor-intensity reversal; This happens when the elasticity of substitution for unskilled labor for skilled labor is greater.

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