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Suppose an economy has 100 units of capital, 100 units of labor, and the efficiency of each worker is equal to 2. The effective number of workers for this economy is _____ and the capital per effective worker is _____.

A. 50; 2
B. 200; 1/2
C. 50; 1/2
D. 200; 2

Answer :

The effective number of workers for this economy is 50 and the capital per effective worker is 2.

A. 50; 2.

How to Calculate the Capital Per Effective Worker?

To calculate the effective number of workers, we need to divide the total amount of labor by the efficiency of each worker:

Effective number of workers = Total labor / Efficiency per worker

= 100 / 2

Effective number of workers = 50

To calculate the capital per effective worker, we need to divide the total amount of capital by the effective number of workers:

Capital per effective worker = Total capital / Effective number of workers

= 100 / 50

= 2

Therefore, the effective number of workers for this economy is 50 and the capital per effective worker is 2.

Learn more about capital per effective worker on:

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