The Next Questions Refer to the Following

question 29

Multiple Choice

The next questions refer to the following.
Suppose the economy has the production function Y = .8K, gross investment is 10% of national income, and the rate of depreciation is 5% of the capital stock.
-If the capital stock suddenly doubles,output will rise by

• A) 80%
• B) a factor of 1.6
• C) 100%
• D) 10%
• E) 5%

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Definitions:

Notice of Lien

A legal document filed to indicate that a claim of ownership has been placed on a property due to unpaid debts.

Period of Time

A specific duration characterized by a starting point and an ending point.

Equity of Redemption

The right of a borrower to reclaim property that is subject to a mortgage by repaying the debt before the foreclosure sale.

Mechanic's Lien

A legal claim against a property for unpaid construction work or materials, ensuring payment to builders, contractors, and construction firms.