Mr. Calhoun owned a worn-out piece of farmland for growing cotton, which he had been unable to rent for years. Suddenly he was getting offers from cotton farmers to lease his land. What is the most likely explanation of this?
A. The price of cotton went down.
B. The physical productivity of the land went up.
C. Taxes on land went up.
D. The price of cotton went up.
Answer: D
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An increase in price:
A. cannot cause a quantity effect. B. cannot cause a price effect. C. causes a decrease in revenue resulting from selling fewer units and a simultaneous increase in revenue resulting from receiving a higher price. D. causes an increase in quantity demanded.
A monopolist will ________ if marginal revenue is negative.
A. increase production B. not produce C. maintain its current production level D. shut down
To reduce labor costs, companies often invent machines and methods to produce products and reduce the amount of labor required. This is called
A) anti-union. B) downsizing. C) failed labor utilization. D) induced innovation.
If the U.S. Gini coefficient increased from 0.4 in 1970 to 0.6 in 1990, what would be most accurate?
a. Income inequality increased in the U.S b. Per capita income increased in the U.S c. Both income inequality and per capita income increased d. Income inequality decreased e. The growth rate of income increased