Suppose that computers use 4 units of capital for each worker, so that KC = 4LC, whereas shoes use 0.2 units of capital for each worker, so that KS = 0.2 LS. There are 200 workers and 200 units of capital in the economy.

a. Solve for the amount of labor and capital used in each industry. Hint: The box diagram shows that the amount of labor and capital used in each industry must add up to the total for the economy, so that KC + KS = 200 and LC + LS = 200 Use the facts that KC = 4 LC and KS = 0.2 LS to rewrite these equations as: 4 LC + 0.2 LS = 200 and LC + LS = 200 Use these two equations to solve for LC and LS, and then calculate the amount of capital used in each industry using KC = 4 LC and KS = 0.2 LS.

b. Suppose that the number of workers increases to 250 because of immigration, keeping total capital fixed at 200. Again, solve for the amount of labor and capital used in each industry. Hint: Redo the calculations from part (a), but using LC + LS = 250.

c. Suppose instead that the amount of capital increases to 250 due FDI, keeping the total number of workers fixed at 200. Again solve for the amount of labor and capital used in each industry. Hint: Redo the calculations from part (a), using KC + KS = 250.

d. Explain how your results in parts (b) and (c) are related to the Rybczynski theorem.