5. When economists talk about diminishing returns to physical capital, they mean that a. an increase in

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5. When economists talk about diminishing returns to physical capital, they mean that

a. an increase in physical capital per worker will cause a reduction in real GDP per worker.

b. an increase in physical capital per worker will lead to smaller and smaller increases in real GDP per worker.

c. over time physical capital wears out.

d. increasing physical capital per worker has no effect on real GDP per worker.

e. increasing physical capital is not a source of economic growth.

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Related Book For  book-img-for-question

Macroeconomics In Modules

ISBN: 978-1464139055

3rd Edition

Authors: Paul Krugman ,Robin Wells

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