____ 37. Mr. Calhoun owned a worn-out piece of farmland for growing cotton, whic
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Question
____ 37. Mr. Calhoun owned a worn-out piece of farmland for growing cotton, which he had been unable to rent for years. Suddenly he was getting offers from cotton farmers to lease his land. What is the most likely explanation of this?
a.
The price of cotton went down.
b.
The physical productivity of the land went up.
c.
Taxes on land went up.
d.
The price of cotton went up.
a.
The price of cotton went down.
b.
The physical productivity of the land went up.
c.
Taxes on land went up.
d.
The price of cotton went up.
Explanation / Answer
d. The price of cotton went up
explanation: As per law of supply, when price of a commodity increases, its supply increases. In order to increase supply of cotton more land is required ot grow cotton and hence demand for farmers; land on lease is increasing.
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