Suppose the current level of output is 5000 and the elasticity of output with respect to capital is 0.4. A 10% increase in capital would increase the current level of output to
(a) 5020.
(b) 5050.
(c) 5200.
(d) 5500.
Answer: C
Suppose the current level of output is 5000 and the elasticity of output with respect to capital is 0.4. A 10% increase in capital would increase the current level of output to
(a) 5020.
(b) 5050.
(c) 5200.
(d) 5500.
Answer: C
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