Map apling leaming Use the graph of the per-worker production function (PWPF) to

Question

Map apling leaming Use the graph of the per-worker production function (PWPF) to answer the questions. al GDP per hour worked (s) Suppose this hypothetical economy is currently operating at point A on PF 1. Which of the foll events could move the economy from A to point B O 0 O O Decrease in the amount of capital Increase in real GDP Technological advancement Increase in the amount of capital 4,590 3,870 3,160 PF1 Which of the following could shift the PWPF from PF1 to PF2, or from point A to C? O Increase in real GDP O Decrease in the amount of capital O Increase in the amount of capital O Technological advancement 40 60 Capital per hour worked

Explanation / Answer

1.increase in the amount of capital - holding technology constant an increase in the capital per hour worked increases the (output) real gdp per hour worked.

2. technological advancement - technological change shifts up the production function and allows increase in real gdp (output) with the same amount of capital per hour worked.

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