Chayanov's Rule States That When Resources Are Converted Primarily to Household

question 55

Multiple Choice

Chayanov's rule states that when resources are converted primarily to household consumption, people will work harder if __________.

• A) there are more consumers in the household
• B) everyone in the household contributes to their ability
• C) everyone in the household contributes the same amount of labor
• D) there are fewer consumers in the household

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Definitions:

Straight-Line Method

A method of calculating depreciation by evenly spreading the cost of an asset over its useful life.

Present Value

The current worth of a future sum of money or stream of cash flows given a specified rate of return, used in discounting to determine investment value.

Lease Agreement

A contract between two parties where one party agrees to rent property owned by another party, often specifying terms and conditions for use and payment.

Straight-Line Method

A method of depreciation that allocates an equal expense amount to each year of the asset's useful life.