If the Slope of the Per-Worker Production Function Is 1/4

question 17

Multiple Choice

If the slope of the per-worker production function is 1/4 in a given range, how will a $10,000 increase in capital per hour worked affect real GDP per hour worked in the same given range?

• A)Real GDP per hour worked will increase by $2,500.
• B)Real GDP per hour worked will increase by $40,000.
• C)Real GDP per hour worked will increase by $10,000.
• D)Real GDP per hour worked will decrease by $40.000.
• E)Real GDP per hour worked will decrease by $10,000.

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Definitions:

Price

The sum of money needed to buy a product or service.

Inelastic

A description of a product's demand when its price elasticity is less than one, indicating that demand is relatively unresponsive to price changes.

Price

The cash amount projected, required, or delivered in settlement for something.

Total Revenue

Total revenue is the total amount of money earned by a firm from the sale of its goods and services before any costs are subtracted.