How Does the Rate of Return Earned on Capital in Various

question 37

Essay

How does the rate of return earned on capital in various industries equalize over time? Do the wages earned by labor in different industries and the interest rates for different assets also equalize in the long-run? Why?

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Definitions:

Treadmill

A piece of exercise equipment designed for walking or running in place, often used for physical fitness.

Implied Warranty

A legal assumption in a sale that the goods or services are fit for the intended purpose, even if not explicitly stated.

Merchantability

A warranty that a product will meet reasonable expectations of quality and perform as generally expected by consumers.

Basis-of-the-Bargain

A legal concept that refers to the conditions and terms that are regarded as crucial in a contractual agreement between parties.