Question : A labour-intensive technique would be chosen in a:
Option 1: labour-surplus economy
Option 2: capital-surplus economy
Option 3: developed economy
Option 4: developing economy
Correct Answer: labour-surplus economy
Solution : The correct answer is the labour-surplus economy .
When there is a labour surplus, labour-intensive techniques are preferred, and when there is a capital surplus, capital-intensive techniques are preferred. Techniques that are labour-intensive use relatively more labour and less capital. With this method, more labour and less capital are needed during the production process.
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