Question

Question 8 of 10 Which situation bestillustrates the process of capital formation? O A. A factory worker takes out a high-interest loan to buy a new home. OB. A farmer increases his profits by growing a variety of new crops. C. An engineer tries to limit her spending during the week. O D. An artist buys bonds that will increase in value over time. SUBMIT​

Answer 1

Answer: B

Step-by-step explanation:

The situation that best illustrates the process of capital formation is B. A farmer increases his profits by growing a variety of new crops. Capital formation refers to the process of accumulating financial resources or assets that can be used for productive purposes. In this scenario, the farmer is increasing his profits by diversifying his crop production, which leads to higher revenues and potential savings. These savings can then be reinvested into the farm, such as purchasing new equipment or expanding operations, contributing to capital formation.