ECON 203 Lecture Notes - Lecture 6: Physical Capital, Diminishing Returns, Factors Of Production

• School: University of Calgary
• Department: Economics
• Course: ECON 203
• Professor: Aamir Hashmi

Document Summary

Rule of 70 something will double in 70 years if the growth rate is 1%, at 10%, it will double in 7 years. Growth rates can vary, so the country rankings can change over time. Poor countries are not doomed to poverty forever. Rich countries can also be overtaken by poorer but faster-growing countries. A graph that show the relationship between input and output. Hours spent studying and the grades you get. F is a function that shows how inputs are combined to produce output. A multiplies the function f so improvements in technology (increases in a) allow more output, y, to be produced from any combination of inputs. Production function will have constant returns to scale. The number of janitors for a small space does not matter after 1. There are diminishing returns because 2 janitors will not do any better than just one.