Capital dilution refers to ________. A) the flow of investment ...

[vHAUNG6011]

Capital dilution refers to ________.
 
  A) the flow of investment in the bathtub model
  B) the depreciation of capital associated with an increase in the percentage of younger workers
  C) the decline in the marginal product of capital that results from reliance on new, inexperienced workers
  D) the decrease in capital per worker that is a direct consequence of an increase in the number of workers

Question 2

With respect to Figure 7-2, an increase in government spending
 
  a. shifts the IS curve to the left by G( b/1  b).
  b. shifts the IS curve to the right by G(1  b/1  b).
  c. shifts the IS curve to the right by G(1/1  b).
  d. does not shift the IS curve.

[owenfalvey]

Answer to Question 1

D

Answer to Question 2

C