Engerman and Solokoff (1997) Posited That If a Country Had

question 12

Multiple Choice

Engerman and Solokoff (1997) posited that if a country had an abundance of commodities, this could lead to the existence of:

• A) an extractive state.
• B) laws and institutions that protected the power of elites
• C) heavy spending on education
• D) large investments in infrastructure
• E) a and b

---

Definitions:

Interest Payments

Payments made to lenders as compensation for borrowing money, typically calculated as a percentage of the principal amount.

Interest Rates

The cost of borrowing money or the return on investment, typically expressed as a percentage.

Pure Rate

An interest rate that reflects only the payment for the time value of money, excluding other risk factors or costs.

Economic Models

simplified representations of complex economic processes or systems used to analyze behavior, make predictions, or provide insights into economic decision-making.