Multiple Choice
The following figure shows two aggregate production functions.
-Refer to the figure above.What does the slope of the aggregate production function 2 between the origin and point A imply?
A) The returns for increases in the physical capital stock are decreasing.
B) The returns for increases in the physical capital stock are increasing.
C) The returns for increases in the physical capital stock are negative.
D) The returns for increases in the physical capital stock are first positive and then negative.
Correct Answer:

Verified
Correct Answer:
Verified
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