An increase in capital stock would: cause a movement to the left along a stationary production function. cause a movement to the right along a stationary production function. shift the production function upward. shift the production function downward.

Question

Isabela Munoz

Business

31 March, 17:55

An increase in capital stock would: cause a movement to the left along a stationary production function. cause a movement to the right along a stationary production function. shift the production function upward. shift the production function downward.

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Answers (1)

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Roger · Answer 1

shift the production function upward

Explanation:

The production function refers to the input and output relations i. e means if the number of inputs are used so the maximum output could be produced

The production function is

Q = f (L, K)

where,

Q represents the quantity

f represents the factors

L represents the labor

K represents the Capital

If there is an increase in capital stock, the production function is also increases i. e the movement is upward keeping other things constant