Alpha Has $40,000 of Capital Per Worker, While Beta Has

question 41

Multiple Choice

Alpha has $40,000 of capital per worker, while Beta has $5,000 of capital per worker. In all other respects, the two countries are the same. According to the principle of diminishing returns to capital, an additional unit of capital will increase output ________ in Alpha compared to Beta, holding other factors constant.

• A)more
• B)less
• C)not at all
• D)by the same amount

---

Definitions:

Obligation

A duty or commitment to fulfill a contractual, legal, or moral requirement.

Rescission

The legal action of cancelling, terminating, or annulling a contract, restoring the parties to their original positions prior to the agreement.

Surety

A person or entity that takes responsibility for another's performance of an undertaking, such as fulfilling the terms of a contract.

Fraud

A deliberate deception practiced to secure unfair or unlawful gain.