The Following Figure Shows Two Aggregate Production Functions

question 184

Multiple Choice

The following figure shows two aggregate production functions.

-Refer to the figure above.Assume the economy is at point B of the aggregate production function 2 in 2010.It will move toward point A in 2012 if the ________.

• A) quantity of physical capital increases and technology remains constant
• B) quantity of physical capital increases and technology increases
• C) number of workers increases and technology remains constant
• D) total efficiency units of labor increase and technology increases

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Definitions:

Sensory Interaction

The process by which different senses, like sight and hearing, influence and interact with each other to form a comprehensive perception.

Sensory Adaptation

The mechanism by which sensory receptors diminish their reaction to persistent stimuli over a period.

Kinesthesis

The faculty for discerning the placement, load, or kinetic changes of muscles, tendons, and joints.

Basilar Membrane

A key structure in the cochlea of the ear, which plays a critical role in the process of hearing by vibrating in response to sound.