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Japan produces electronics and food. Land is a specific input factor in the production of food. Electronics production requires dedicated capital input. Labour can flow

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Japan produces electronics and food. Land is a specific input factor in the production of food. Electronics production requires dedicated capital input. Labour can flow freely between the two industries. A new fertilizer drastically improves the productivity of land. We can expect O the amount of capital in Japan decreases labour allocation remains constant O workers experience welfare gain O the marginal product of capital increases

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