Question 1

Other things the same,which of the following could explain an increase in productivity?

Accepted Answer

An increase in productivity can be explained by either an increase in human capital (such as training, education, or skills) or an increase in physical capital (such as machinery, technology, or equipment). Therefore, option A is the best choice.

Question 2

Suppose there are constant returns to scale.Now suppose that over time a country doubles its workers,its natural resources,its physical capital,and its human capital,but its technology is unchanged.Which of the following would double?

Accepted Answer

With constant returns to scale, doubling all inputs will result in a doubling of output. However, since technology is unchanged, productivity (output per input) will not increase. Therefore, output will double but productivity will not change.

Question 3

Suppose a country imposes new restrictions on how many hours people can work.If these restrictions reduce the total number of hours worked in the economy,but all other factors that determine output are held fixed,then

Accepted Answer

If the total number of hours worked in the economy reduces due to new restrictions, it means that the output produced by the economy will also reduce. However, if all other factors remain constant, the productivity of the workers may increase because they have to complete the same amount of work in fewer hours. Therefore, productivity may rise while output falls.

Question 4

In a particular production process,if the quantities of all inputs used are increased by 60 percent,then the quantity of output increases by 60 percent as well.This means that

Accepted Answer

If the production process exhibits constant returns to scale, then increasing all inputs by the same proportion (in this case, 60%) will result in a corresponding increase in output by the same proportion (also 60%). Therefore, option D is correct. Option A can be ruled out because it assumes that technological advances cannot increase the production process, which is not necessarily true based on the given information. Option B can also be ruled out because the given information does provide some mathematical description of the relationship between inputs and outputs. Option C is also incorrect because the presence of limits to growth property would mean that increasing inputs by 60% would not result in an increase in outputs by the same proportion.

Question 5

In the equation for the production function H/L represents

Accepted Answer

The answer of In the equation for the production function...

Question 6

If the number of workers in an economy doubled,all other inputs stayed the same,and there were constant returns to scale,productivity would

Accepted Answer

If the number of workers in an economy doubled and all other inputs stayed the same, the productivity would fall, but it would still be greater than one-half of its former value. This is because the constant returns to scale mean that doubling the number of workers would not double the output, but it would increase it by less than double. Therefore, productivity would decrease but still be greater than one-half of its former value.

Question 7

You sell fruit smoothies.One day you double the time you spend and double all your inputs,and make twice as many smoothies.Your smoothie production function has

Accepted Answer

Constant returns to scale means that when inputs (in this case, time and ingredients) are doubled, output (number of smoothies) is also doubled. Since the number of smoothies is indeed doubled when input is doubled, it shows constant returns to scale.

Question 8

If your firm's production function has constant returns to scale and you increase all your inputs by 60%,then your firm's output will

Accepted Answer

If the production function has constant returns to scale, then increasing all inputs by the same proportion will result in an output increase by that same proportion. Therefore, if all inputs are increased by 60%, output will also increase by 60%.

Question 9

Which of the following would increase productivity?

Accepted Answer

An increase in physical capital stock per worker (Choice A) would increase the tools and machinery available to that worker, allowing for more output per unit of time. A increase in human capital per worker (Choice B) would increase the knowledge, skills, and experience of that worker which would result in an increased ability to complete tasks efficiently and effectively. An increase in natural resources per worker (Choice C) would also allow for more output per unit of time. Thus, all of the choices listed would lead to an increase in productivity.

Question 10

If there are constant returns to scale,the production function can be written as

Accepted Answer

The answer of If there are constant returns to scale,the...

Question 11

If a production function has constant returns to scale,output can be doubled if

Accepted Answer

Constant returns to scale means that if all inputs are doubled, output will also double. Therefore, choice C is the correct answer. Choices A and B involve only doubling one or some inputs, which would not necessarily result in doubling the output.

Question 12

If an economy with constant returns to scale were to double its physical capital stock,its available natural resources,and its human capital,but leave the size of the labor force the same,

Accepted Answer

Since the economy has constant returns to scale, doubling all inputs will result in approximately a doubling of output. However, since the labor force has not increased, there will be diminishing marginal returns to the increased inputs, resulting in a less than double increase in output and productivity.

Question 13

You bake cookies.One day you double the time you spend,double the number of chocolate chips,flour,eggs,and all your other inputs,and bake twice as many cookies.Your cookie production function has

Accepted Answer

The answer of You bake cookies.One day you double the...

Question 14

If your firm's production function has constant returns to scale,and if you double all your inputs,then your firm's productivity will

Accepted Answer

The answer of If your firm's production function has constant...

Question 15

In a particular production process,if the quantities of all inputs used double,then the quantity of output doubles as well.This means that

Accepted Answer

A production function exhibits constant returns to scale when increasing the scale of production by a certain proportion increases output by the same proportion. In this case, doubling the quantities of inputs leads to a doubling of output, indicating constant returns to scale. Therefore, the correct choice is D. The other options are incorrect because there is no information given in the question to support them.

Question 16

Which of the following is a determinant of productivity?

Accepted Answer

All of the factors listed are important determinants of productivity. Human capital, or the skills, education, and knowledge possessed by workers, is critical for their ability to perform tasks efficiently and effectively. Physical capital, such as machinery and equipment, can help amplify the productivity of workers. Natural resources, such as raw materials, also play a role in productivity, as they can be inputs into production processes. Therefore, all three factors are important for determining productivity levels.

Question 17

If your firm's production function has constant returns to scale,then if you double all your inputs,your firm's output will

Accepted Answer

Constant returns to scale means that doubling all inputs will result in doubling output. However, since productivity is output per unit of input, and we are doubling all inputs, productivity (output per unit of input) will not change.

Question 18

An economy's production function has the constant-returns-to-scale property.If the economy's labor force doubled and all other inputs stayed the same,then real GDP would

Accepted Answer

The answer of An economy's production function has the constant-returns-to-scale...

Question 19

In the equation for the production function Y/L represents

Accepted Answer