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Two countries A and B have the same aggregate production function Y = A. In addition, they have the ...

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Two countries A and B have the same aggregate production function Y = A. In addition, they have the ...

Two countries A and B have the same aggregate production function Y = A

. In addition, they have the same level of technology and same level of output. However, if country A adds one more unit of capital, it will have a larger increase in output than if country B were to do the same. What can you infer from this?

▸ Country A and country B have the same level of capital stock K.

▸ Country A has a higher level of capital stock K than country B.

▸ Country A has a lower level of capital stock K than country B.

▸ Country A and country B have the same level of total efficiency units of labor H.

Textbook

Macroeconomics

Edition: 3^rd

Authors: Acemoglu, Laibson, List

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thatguy67 Author

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This helped my grade so much Perfect

54321abs

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Correct

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Thanks for your help!!

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