Q2. Which of the following properties does this production function exhibit: Y = 2K + 3L a) Constant returns to scale b) Diminishing marginal product of labor c) Diminishing margin product of capital d) All of the above Q4. Which of the following will increase US GDP? a) an increase in stock market prices b) an increase in social security payments c) a decrease in the foreign aid for developing countries by the US government d) an increase of projects to x old roads Q7. Suppose we calculate the percent change in real GDP from year 1 to year 2 using both the LaSpeyres and the Paasche indices. With the LaSpeyres index we get 15 percent and with the Paasche index we get 6 percent. The chain-weighted growth of real GDP is: a) 1.5 percent b) 9.5 percent c) 9.75 percent d) 10.5 percent Q8. This year, a real estate agent helped you buy a house for $200,000. The house was originally built in 1985. The agents coninn'ssion was $12,000. How will this transaction aect this years GDP? a) Consumption expenditures will increase by $212,000. b) Consumption expenditures will increase by $12,000. c) Investment expenditures will increase by $212,000. d) Investment expenditures will increase by $200,000. Year Price of Tea Quantity of Tea Price of Basketballs Quantity of Basketballs 2014 20 40 25 10 2 50 20 20 2017 2 Q9. What is the real GDP in 2017 in the economy above, using 2014 as the base year? a) 1,700$ Q10. Which of the following questions does the Solow model NOT help to explain? a) Why do countries have different growth rates in the same time periods? b) Why are some countries richer than other countries? 0) Why do countries sustain growth in the long run? (1) Will a country be richer if the investment rate is higher than another country, all else being equal