Explain the productivity curve and how the components interact
What will be an ideal response?
The productivity curve is a relationship that shows how real GDP per hour of labor varies as the amount of capital per hour of labor changes with no change in technology. An increase in the amount of capital per hour of labor leads to a movement along a productivity curve. An increase in technology shifts the productivity curve upward.
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When the United States imposes an import quota on a good, the amount of the ________ in U.S. consumer surplus is ________ the amount of the ________ in U.S. producer surplus
A) increase; smaller than; increase B) decrease; larger than; decrease C) decrease; larger than; increase D) decrease; equal to; increase
One reason that education has external benefits is that
A) knowledge has diminishing marginal productivity. B) education creates job opportunities for teachers. C) education creates better citizens. D) property owners pay taxes to support the school system.