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(Solved): 2. Which Of The Following Statements Is (are) Correct? A. A Farmer Plants A New Type Of Seed Because...


2. Which of the following statements is (are) correct?
A. A farmer plants a new type of seed because of proven results of improved crop growth. This is an example of a technological advance in seed development
B. A farmer sends a laborer to agricultural college and the laborer returns to work on the farm after completion of the educational endeavor. This action is an example of an increase in human capital.
C. When a farmer buys another tractor to plow cropland it reflects an increase in physical capital.
D. All of the above
E. A and B, only
3. Which of the following statements is (are) correct?
(x) If a country were to increase its saving rate, then in the long run it would also increase its level of capital and its level of income
(y) Country A and country B are the same except country A currently has a lower level of capital. Assuming diminishing returns, if both countries increase their capital by 100 units and other factors that determine output are unchanged, then output in country A increases by more than in country B.
(z) All else equal, if there are diminishing returns, then if a country raised its capital by 100 units last year and by 100 units this year, the increase in output was greater for this year than last year.
A. (x), (y) and (z)
B. (x) and (y) only
C. (x) and (z) only
D. (y) and (z) only
E. (z) only

6. Which of the following statements is (are) correct?
(x) If the price of copper in Rockland increased by three percent in 2012 and the overall price level in
Rockland increased by five percent, then the real price of copper in Rockland increased in 2012.
(y) The behavior of market prices over time show that natural resources are not a limit to economic growth
since the prices of most natural resources are stable or falling relative to other prices.
(z) In a market economy, we know that a natural resource has become scarcer when its price rises relative
to other prices.
A. (x), (y) and (z)
B. (x) and (y) only
C. (x) and (z) only
D. (y) and (z) only
E. (y) only



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