In a Small European Country,it Is Estimated That Changing the Level

question 130

Multiple Choice

In a small European country,it is estimated that changing the level of capital from $8 million to $10 million will increase real GDP from $2 million to $3 million.What level of GDP would you expect the economy to be able to reach if spending on capital continued to rise to $12 million,assuming no technological change and no change in the hours of work?

• A)GDP would increase further,but by less than $1 million.
• B)GDP would increase further by exactly $1 million.
• C)GDP would increase further by more than $1 million
• D)GDP would increase further by exactly $4 million.

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