For Three Years, There Was No Technological Change in Longland

question 3

Multiple Choice

For three years, there was no technological change in Longland but capital per hour of labour increased from $10 to $20 to $30 and real GDP per hour of labour increased from $3.80 to $5.70 to $7.13.Then in the fourth year, capital per hour of labour remained constant but real GDP per hour of labour increased to $10.Longland _______
Experience diminishing returns because _______ .

• A)does; as capital per hour of labour increases, real GDP per hour of labour increases but by smaller amounts
• B)does; all countries experience diminishing returns
• C)does not; in the fourth year capital per hour of labour does not change
• D)does; in the fourth year capital per hour of labour does not change
• E)does not; as capital per hour of labour increases, real GDP per hour of labour also increases

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Net Income

The company's net income following the deduction of all costs and taxes from its total revenue.

Investing Activities

Transactions involving the acquisition or sale of long-term assets and investments, reflected in a company’s cash flow statement.

Financing Activities

Activities that result in changes in the size and composition of the equity capital and borrowings of the entity.

Operating Activities

Activities that relate to the core business operations of a company, including revenue and expense transactions.