Suppose That a Large Lake in the Middle of Minnesota

question 8

Multiple Choice

Suppose that a large lake in the middle of Minnesota evaporates, leaving more fertile farm land for growing corn available. Assuming that land and labor are complements in a farming production function, what would happen to the wages earned by workers and rents earned by landowners?

• A)Both wages and rents would increase.
• B)Both wages and rents would decrease.
• C)Wages would increase, and rents would decrease.
• D)Wages would decrease, and rents would increase.

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Definitions:

Conservation

In cognitive development, the understanding that certain properties of an object or substance remain the same even when its appearance is altered, typically developed during the concrete operational stage.

Conservation

In cognitive psychology, the concept that children learn that quantity, length, or number remain the same despite changes in appearance or form.

Object Permanence

The understanding in human development that objects continue to exist even when they cannot be seen, heard, or touched.

Egocentric

A term referring to the inability or difficulty in understanding a perspective other than one's own.