Figure 22-2
-Refer to Figure 22-2. Assuming no technological change, if the United States increases capital per hour worked by $40,000 every year between 2010 and 2014, we would expect to see
A) real GDP per hour worked will increase by the same increment each year between 2010 and 2014.
B) real GDP per hour worked will be lower in 2014 than it was in 2010.
C) the per-worker production function will get flatter over time.
D) the per-worker production function will shift up every year there is increase in capital per hour worked.

Question

Figure 22-2 
-Refer to Figure 22-2. Assuming no technological change, if the United States increases capital per hour worked by $40,000 every year between 2010 and 2014, we would expect to see
A) real GDP per hour worked will increase by the same increment each year between 2010 and 2014. 
B) real GDP per hour worked will be lower in 2014 than it was in 2010. 
C) the per-worker production function will get flatter over time. 
D) the per-worker production function will shift up every year there is increase in capital per hour worked.

Quizplus · Accepted Answer

As capital per hour worked increases, the per-worker production function becomes flatter due to diminishing returns to capital.

Figure 22-2 -Refer to Figure 22-2. Assuming No Technological Change, If the Change