An industry for which labor costs comprise a high percentage of total expenses

• A. Capital-Intensive Industry
• B. Automated Industry
• C. Labor-Intensive Industry
• D. Service Industry

Answer: (C)

Understanding how industries are classified by cost structure helps explain this. When labor costs make up a large share of total production expenses, the industry is described as labor-intensive. In these industries, paying workers—wages, salaries, and benefits—drives most of the costs, while capital equipment and automation contribute relatively less. That makes labor-intensive the best fit here because the defining feature is a high proportion of expenses tied to labor. Examples include crafts or garment production and some agricultural activities. By contrast, capital-intensive industries rely more on machinery and facilities, automated industries reduce the need for human labor, and service industries can vary, but the emphasis here is on the large labor share.