Economics · International Trade Theorems
Consider the following statements: Statement I: The Rybczynski theorem postulates that at constant commodity prices, an increase in the endowment of one factor will increase the output of the commodity intensive in that factor by a greater proportion and will reduce the output of the other commodity. Statement II: The Stolper-Samuelson theorem postulates that an increase in the relative price of a commodity increases the return or earnings of the factor used intensively in the production of that commodity. Choose the correct option:
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Both Statement I and Statement II are true
- 2Both Statement I and Statement II are false
- 3Statement I is true, but Statement II is false✓
- 4Statement I is false, but Statement II is true
Correct answer
Statement I is true, but Statement II is false
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