In the long run, what would happen if the demand for agricultural products suddenly became elastic? Explain
What will be an ideal response?
In the long run, agriculture would still be a declining industry even if demand suddenly became elastic. This is because inelastic demand is not the only factor hurting agriculture. Resources are also relatively immobile, so even with elastic demand, an increase in supply would only lead to slight increases in incomes. The increases may not be sufficient to increase farm incomes by much and keep resources in agriculture.
If all farm resources were mobile, this would lead to a shift of resources into another productive sector. However, since land resources are not mobile, the reallocation of labor is taking place too slowly to offset the continued increase in output due to rising productivity. In addition to these more or less natural market obstacles, there is the complication of government policy, which now tends to support many inefficient farmers with just enough income to allow them to remain in farming.
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A) creditors B) debtors C) persons living on a fixed income D) retired individuals
The current account shows international transactions in goods and services, the capital account shows international transactions involving the flow of financial assets, and the official reserve transactions account shows movement of international reserves
a. True b. False
Which of the following is not considered investment?
A. the construction of a new factory B. the purchase of government bonds C. the acquisition of capital goods D. the increase in planned inventories