Which of the Following Statements Is True About an Economy

question 87

Multiple Choice

Which of the following statements is true about an economy whose production function includes only capital and labor?

• A)Diminishing returns to capital can occur for the economy as a whole.
• B)Adding more capital per worker cannot raise real GDP beyond some limit.
• C)The production function yields a pessimistic conclusion about economic growth.
• D)To get to the point where the return from an additional unit of capital equals zero requires an extremely large investment share of GDP.
• E)All of these

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Definitions:

Directional Alternative

A hypothesis that outlines the anticipated direction in the variation or association among variables.

T-statistic

A T-statistic is used in statistical testing to determine the significance of the difference between the means of two groups relative to the spread or variability of their scores.

Means

Statistical measures that represent the average value in a set of numbers, calculated by dividing the sum of all numbers by the count of numbers.

Null Hypothesis

The default hypothesis that there is no effect or no difference, and any observed deviation from this state is due to chance.