Multiple Choice
Scenario: Country X and Country Y have identical aggregate production functions as shown in the figure below. The amount of physical capital stock available to each country is also equal. However, the labor supply for Country X is HX, while the labor supply for Country Y is HY.
-Refer to the scenario above.A one-unit increase in the efficiency units of labor will lead to ________ in output in Country X than in Country Y.
A) a larger increase
B) a smaller increase
C) a larger decrease
D) a smaller decrease
Correct Answer:
Verified
Correct Answer:
Verified
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