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(Table: Sales and Payments) Suppose That the Price of the Manufactured

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(Table: Sales and Payments) Suppose that the price of the manufactured good rises by 20% with no change in the price of the agricultural good. Wages in both sectors rise by 10%. Which of the following is the correct ordering (from highest to lowest) of changes in the real wage, real rental on capital, and real rental on land? (Table: Sales and Payments)  Suppose that the price of the manufactured good rises by 20% with no change in the price of the agricultural good. Wages in both sectors rise by 10%. Which of the following is the correct ordering (from highest to lowest)  of changes in the real wage, real rental on capital, and real rental on land?   A)  real rental on land, real wage, real rental on capital B)  real wage, real rental on land, real rental on capital C)  real rental on capital, real rental on land, real wage D)  real rental on capital, real wage, real rental on land


Definitions:

Absolute Advantage

The capability of a country, entity, or individual to produce a good or service more efficiently than competitors, using fewer resources.

Cars

Motor vehicles with four wheels typically used for transportation of people rather than goods.

Trucks

Heavy vehicles used for transporting goods and materials over land.

Opportunity Cost

The cost of forfeiting the next best alternative when making a decision, representing the benefits missed when choosing one option over another.

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