Question

8:18 .. . < Back Chapter 11.docx ECO 2013 Homework Chapter 11 Real GDP per hour worked, YIL $17.000 16,400 16.000 Production function Production function2 Production function 15,000 $50,000 60,000 70.000 Capital per hour worked, KL Figure 1 1) Refer to Figure 1. Suppose the economy gains more capital per hour worked and experiences technological change. This is shown in the figure above by the movement from A) E to B to D. B) A to B to C. C) A to D) A to D. 2) Refer to Figure 1. Which of the following combinations of points illustrates changes in the Soviet Union's economy from 1950 to 1980? A) E to B B) B to D B to E D) A to B to C 3) Refer to Figure 1. Using the per-worker production function in the figure above, the largest changes in an economy's standard of living would be achieved by a movement from A) A to B to C. B) E to B to D. C) C to B to A. D) D to B to Dashboard Calendar To Do Notifications Inbox

Answer 1

Question 1

When capital per hour worked increases then there is an upward movement along the production function of an economy.

On the other hand, when the technological change takes place then in that case production function shifts upward.

The movement from point A to point D resembles upward movement along the production function.

It also indicates an upward shift of the production function as well.

Hence, the correct answer is the option (D) [A to D].

Question 2

Between 1950s and 1980s, Soviet Union experienced a significant increase in the capital per worker or the capital per hour worked.

When capital per hour worked increases then there is movement upward along the production function.

The movement from point A to point B to point C indicates an upward movement along the production function and thus indicates an increase in the capital per hour worked.

Hence, the correct answer is the option (D) [A to B to C].

Question 3

Economy's standard of living increases when real GDP per hour worked increases.

The given figure shows that the real GDP per hour worked clocks maximum increase when there is movement from point A to point or when there is movement from point E to point D.

Thus,

The largest change in an economy's standard of living would be achieved by a movement from E to B to D.

Hencem the correct answer is the option (B)