2) IfY = A× (100 +K/N), whereK= 1000,N= 50, andA=
2) If Y = A × (100 + K/N), where K = 1000, N = 50, and A =
10, what happens if K doubles and N doubles?
A) Y is unchanged.
B) Y increases by 50%.
C) Y doubles.
D) Y quadruples.
5) Suppose the economy’s production function is Y = A . If K = 2000, N = 100, and A = 1, then Y = 246. If K rises by 20%, and A and N are unchanged, by how much does Y increase?
A) 30%
B) 10%
C) 6%
D) 3%
6) Suppose an economy has GDP equal to 2000 million, the capital stock is 800 million, and the number of
employees equals 150 million. The production function is Y=AK0.25 N0.75 Total factor productivity of the economy is approximately equal to
A) 0.88.
B) 5.77.
C) 8.77.
D) 12.87.
7) The table below represents Econalyst’s macroeconomic data for Year 1 and Year 2.
Year
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