Using the per-worker production function graph from Figures 22.3 and 22.4 on pages 738 and 740, show the effect on real GDP per hour worked of an increase in capital per hour worked, holding technology constant. Now, again using the per-worker production function graph, show the effect on real GDP per hour worked of an increase in technology, holding constant the quantity of capital per hour worked.

Figure 22.3

Figure 22.4

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Real GDP per hour worked, YIL Per-worker production function 2. .. lead to diminishing increases in output per hour worked. $60 57 53 1. Equal increases in capital per hour worked... 48 $75 100 125 150 Capital per hour worked, KIL Real GDP per hour worked, Y/L Production $75 function, Production functiong 70 Production function, 65 Production function; 60 Technological change causes the per-worker production function to shift up. $150 Capital per hour worked, K/L