8. Problems and Applications Q7 What is the opportunity cost of investing in cap

Question

8. Problems and Applications Q7 What is the opportunity cost of investing in capital? Improved technology that leads to faster growth The loss of consumption that results from redirecting resources toward investment Higher taxes Which of the following statements are consistent with a country possibly overinvesting in capital? Check all that apply. As the stock of capital rises, the extra output produced from an additional unit of capital falls. People would prefer to have lower consumption spending and higher future growth As the stock of capital rises, the extra output produced from an additional unit of capital rises. People would prefer to have higher consumption spending and less future growth. What is the opportunity cost of investing in human capital? Improved technology that leads to faster growth O The goods or resources that could be produced if not investing in human capital O Lower taxes Which of the following statements are consistent with a country possibly overinvesting in human capital? Check all that apply. The best job a Ph.D. in philosophy can find is managing a restaurant. People are not educated enough to fill existing job openings. Each person's education level matches his or her profession.

Explanation / Answer

1-the loss of consumption that results from redirecting resources towards investment

2-both option A and B

3-the goods or resources that could be produced if not investing in human capital

4-option A

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