The Idea That the Production Function Exhibits_{-------------}implies That_{-------------}

question 95

Multiple Choice

The idea that the production function exhibits_{-------------}implies that_{-------------}

• A)increasing returns; potential GDP is always increasing.
• B)constant returns; each additional unit of labor employed generates an increasing amount of real GDP.
• C)diminishing returns; each additional unit of labor employed generates an ever-decreasing amount of real GDP.
• D)increasing returns; output should increase steadily as technology grows.
• E)diminishing returns; the Lucas Wedge increases at output increases.

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