1. Diminishing returns to physical capital means that when the state of technology and human capital per worker are fixed, an increase in the amount of physical capital per worker leads to: a smaller increase in the marginal product of labor. a decrease in the total amount of output. negative marginal product. a constant amount of total output. 2. An increase in capital stock would: shift the production function upward. shift the production function inward. shift the production function downward. cause a movement to the right along a stationary production function. cause a movement to the left along a stationary production function.
1. Diminishing returns to physical capital means that when the state of technology and human capital per worker are fixed, an increase in the amount of physical capital per worker leads to: a smaller increase in the marginal product of labor. a decrease in the total amount of output. negative marginal product. a constant amount of total output. 2. An increase in capital stock would: shift the production function upward. shift the production function inward. shift the production function downward. cause a movement to the right along a stationary production function. cause a movement to the left along a stationary production function.
Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
14th Edition
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Chapter7: Production Economics
Section: Chapter Questions
Problem 3E
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1. Diminishing returns to physical capital means that when the state of technology and human capital per worker are fixed, an increase in the amount of physical capital per worker leads to:
a smaller increase in the marginal product of labor.
a decrease in the total amount of output.
negative marginal product.
a constant amount of total output.
2. An increase in capital stock would:
shift the production function upward.
shift the production function inward.
shift the production function downward.
cause a movement to the right along a stationary production function.
cause a movement to the left along a stationary production function.
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