In a Small Asian Country, It Is Estimated That Changing

question 269

Multiple Choice

In a small Asian country, it is estimated that changing the level of capital from $8 million to $12 million will increase real GDP from $4 million to $6 million.What level of GDP would you expect the economy to be able to reach if spending on capital continued to rise to $16 million, assuming no technological change and no change in the hours of work?

• A)GDP would increase further, but by less than $2 million.
• B)GDP would increase further by exactly $2 million.
• C)GDP would increase further by more than $2 million.
• D)GDP would increase further by exactly $8 million.
• E)GDP would increase further by more than $8 million.