How does technological progress affect the production function?

Question

BlackTom AI · Accepted Answer

The question asks: How does technological progress affect the production function?

Given information shows only one option labeled as the correct choice: 'c. It increases the output for given amounts of capital and labour'.

Option analysis:

- The provided option asserts that technological progress raises output for the same input bundle of capital and labour. This aligns with standard economic theory: advancements in technology improve the efficiency of combining inputs, effectively shifting the production function upward or making it less input-intensive for the same output. In practical terms, with better technology, a firm can produce more output without increasing inputs, or achieve the same output with fewer inputs. This is a core idea behind total factor productivity and is consistent with the concept of a technological improvement expanding production capacity.

- Since there are no other options given to compare, it is not possible to critique alternative statements. Normally, one would examine other potential options such as statements claiming technology only affects capital or only affects labor, or that technology leaves production unchanged, and show why those would be incorrect. Without those alternative options, we cannot assess erroneous reasoning points for them here.

In summary, the option stating that technological progress increases output for given amounts of capital and labour reflects the fundamental impact of technology on the production function by enhancing efficiency and productivity.

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How does technological progress affect the production function?

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My home Quiz 3 Week 9

How does technological progress affect the production function?

View Explanation

Log in for full answers

Similar Questions

Use the following graph to answer the next question, where LRATC = long-run average total cost. What happens when a firm adopts a new technology?

What do you think would be the Cobb-Douglas single best prescription for poor countries to catch up with the rich?

From the Cobb-Douglas production function we learn that there are two sources that help explain cross-country differences in per capita income: ________ and ________.

A firm's production function shows

Which of the following changes would shift the entire production function upward?

Refer to the following figure when answering the following questions. Figure 4.1: Production Function Consider Figure 4.1. For given and fixed ˉ L , the shape of this production function suggests that α in the production function Y=Kα ˉ L 1−α is ______.

A production function is a technological relationship between:

More Practical Tools for Students Powered by AI Study Helper

Making Your Study Simpler

From the Cobb-Douglas production function we learn that there are two sources that help explain cross-country differences in per capita income: and .