Macro Ch. 6 - Macroeconomics Ch. 6:1-18 Many of the world's...

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Macroeconomics Ch. 6:1-18 1. Many of the world’s most productive economies today have little land because industrialization and trade have liberated them from dependence on land. 2. The two kinds of change that improve worker productivity are a increase in the quantity of capital per worker, as reflected by a movement along the per-worker production function, and an improvement in the quality of capital per worker, as reflected by technological change that rotates the curve upward. An increase in the quantity of capital worker would be like giving a truck driver a bigger truck, which results in his ability to haul more goods. An increase in the quality of capital would be giving the worker a faster truck, so he can accomplish the job quicker and haul more goods in a given time period. Output per worker versus capital per worker determines the slop of the per worker production curve. 3. The contributing factors to the slower growth rate during the 1974-1982 era were rises in oil prices causing a recession and changes in legislation to protect and improve workplace safety, which increased production costs. 4. Output per capita can increase more than labor productivity because the number of workers can increase while the production per worker stays the same. It is not possible for labor productivity to increase more than output per capita because an increase in labor productivity increases output per capita. 5. Governments can promote the development of practical technology by
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This note was uploaded on 04/21/2008 for the course ECONOMICS 2113 taught by Professor Kenmiller during the Spring '08 term at Oklahoma Christian.

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Macro Ch. 6 - Macroeconomics Ch. 6:1-18 Many of the world's...

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