According to the traditional view of the production process, how does output per worker change when...
According to the traditional view of the production process, how does output per worker change when capital per worker increases?
a. It increases. This increases is larger at large values of capital per worker.
b. It increases. This increases is smaller at larger values of capital per worker.
c. It increases. This increases is the same at all values of capital per worker.
d. It decreases. This decrease is larger at larger values of capital per worker.
Homework Answers
Option B is correct
There are diminishing returns to capital as well. As more and more capital is available, the additional output generated from the additional unit of capital goes on declining. But it is true that when there is an increase in the capital per worker, more capital is available for the given number of workers, which increases workers productivity and increase output per worker.
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According to the traditional view of the production process, how
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