What is the level of productivity in the economy

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Reference no: EM13218903

Suppose that the table below shows an economy's relationship between real output and the inputs needed to produce that output: Input Quantity Real GDP 150.0 $400 112.5 300 75.0 200

a. What is the level of productivity in this economy?

b. What is the per-unit cost of production if the price of each input unit is $2?

c. Assume that the input price increases from $2 to $3 with no accompanying change in productivity. What is the new per-unit cost of production? Instructions: Include two decimal places in your answer. $ In what direction would the $1 increase in input price push the economy's aggregate supply curve? RightLeft What effect would this shift of aggregate supply have on the price level and the level of real output? Price level would increase and real output would decrease.Both price level and real output would remain the same.Price level would decrease and real output would increase.Price level would decrease and real output would remain the same.

d. Suppose that the increase in input price does not occur but, instead, that productivity increases by 100 percent. What would be the new per-unit cost of production?

What effect would this change in per-unit production cost have on the economy's aggregate supply curve? RightLeft What effect would this shift of aggregate supply have on the price level and the level of real output? Price level would increase and real output would decrease.Both price level and real output would remain the same.Price level would decrease and real output would increase.Price level would decrease and real output would remain the same.

Reference no: EM13218903

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