Answer the following questions based upon the following production function for the aggregateeconomy:Y = F(K, L) = A K0.6L0.4%3DWhere Y is aggregate output, A is a measure of available technology, K is capital and L is labor.When graphed, the production function will be concave to the origin, exhibiting increasingMarginal Product of Capital (MPK)Select one:TrueO False For a small, open economy when spending exceeds production thenI. This country will run a trade deficitII. This country will be a net lenderII. This country will export less than it importsa. Statements II and III are trueO b. Statements I and III are truec. Statements I, Il and III are trueO d. Statements I and II are true

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Y = F(K, L) = A K0.6L0.4 Where Y is aggregate output, A is a measure of available technology, K is capital and L is labor. When graphed, the production function will be concave to the origin, exhibiting increasing Marginal Product of Capital (MPK) Select one: O True O False

Y = F(K, L) = A K0.6L0.4 Where Y is aggregate output, A is a measure of available technology, K is capital and L is labor. When graphed, the production function will be concave to the origin, exhibiting increasing Marginal Product of Capital (MPK) Select one: O True O False

Economics (MindTap Course List)

13th Edition

ISBN:9781337617383

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter17: Economic Growth: Resources, Technology, Ideas And Institutions

Section17.2: A Production Function And Economic Growth

Problem 4ST

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