The Productivity of a South American Country Is Given by the Function

question 88

Multiple Choice

The productivity of a South American country is given by the function when x units of labor and y units of capital are used. What is the marginal productivity of labor and what is the marginal productivity of capital when the amounts expended on labor and capital are 288 units and 18 units, respectively? Should the government encourage capital investment rather than increased expenditure on labor at this time in order to increase the country's productivity? Please answer yes or no. ​

• A) The marginal productivity of labor is 10. The marginal productivity of capital is 160. The government should have encouraged increased spending on labor rather than on capital. ​
• B) The marginal productivity of labor is 7.5. The marginal productivity of capital is 40. The government should not have encouraged increased spending on capital rather than on labor. ​
• C) The marginal productivity of labor is 10. The marginal productivity of capital is 160. The government should have encouraged increased spending on capital rather than on labor. ​
• D) The marginal productivity of labor is 7.5. The marginal productivity of capital is 40. The government should have encouraged increased spending on capital rather than on labor. ​

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