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In a Diagram of the Economy's Production Function That Plots

Question 31

Multiple Choice

In a diagram of the economy's production function that plots labor input on the horizontal axis and output on the vertical axis, an increase in the capital stock is represented by


A) a movement along the production function to higher levels of labor input and output.
B) an upward shift in the production function reflecting the corresponding increase in labor productivity due to the increase in capital.
C) a downward shift in the production function due to the decline in labor's share in producing output.
D) a movement along the production function to lower levels of labor input.
E) none of the above.

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