China's State Council Has Encouraged More Spending to "Improve Transportation

question 47

Multiple Choice

China's State Council has encouraged more spending to "improve transportation links and other infrastructure...." It will also "step up its spending on vocational training and other educational programs for adults." www.nytimes.com, Keith Bradsher, October 19, 2008
Suppose that capital goods are on the vertical axis while consumption goods are on the horizontal axis of China's PPF. As a result of enacting the policies, we would expect
I. an expansion of China's production possibilities.
II. capital accumulation.
III. an increase in human capital.

• A) i and II only.
• B) i, II and III.
• C) i and III only.
• D) II and III only.

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Definitions:

Trade Sales Promotions

Marketing activities designed to stimulate demand and sales of a product among retailers and distributors.

Markup

The difference between the cost of a product or service and its selling price, expressed as a percentage of the cost, used to cover expenses and generate profit.

FOB Shipping Point Pricing

A term in shipping where the buyer is responsible for the goods once they leave the seller’s premises, including paying for shipping and handling.

Corporate Customers

Businesses or organizations that purchase a company's products or services, often in bulk or on a contractual basis.