Suppose That an Economy's Labor Productivity and Total Worker-Hours Each

question 102

Multiple Choice

Suppose that an economy's labor productivity and total worker-hours each grew by 4 percent between year 1 and year 2. We could conclude that this economy's

• A) real GDP also increased by 4 percent.
• B) real GDP remained constant.
• C) production possibilities curve shifted outward.
• D) capital stock increased by 4 percent.

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Definitions:

Independent Appraisal

An evaluation conducted by a neutral third-party to determine the value of a property, business, or other asset.

Capital Account Balances

The amounts recorded in the equity section of a company’s balance sheet, representing the net worth contributed by owners or shareholders.

Net Income

The total profit of a company after all expenses and taxes have been subtracted from total revenue.

Cash Investment

The act of putting money into financial schemes, shares, property, or a commercial venture with the expectation of achieving a profit, primarily in liquid assets.