Consider the economies of Blahnik and Tralfamadore, both of which produce gobs of goo using only tools and workers. Suppose that, during the course of 10 years, the level of physical capital per worker rises by 4 tools per worker in each economy, but the size of each labor force remains the same. Complete the following tables by entering productivity (in terms of output per worker) for each economy in 2020 and 2030.
Blahnik
Physical Capital Labor Force Output Productivity
Year (Tools per worker) (Workers) (Gobs of goo) (Gobs per worker)
2020 11 30 3,000
2030 15 30 3,600
Tralfamadore
Physical Capital Labor Force Output Productivity
Year (Tools per worker) (Workers) (Gobs of goo) (Gobs per worker)
2020 8 30 2,400
2030 12 30 3,600
Initially, the number of tools per worker was higher in Blahnik than in Gribinez. From 2018 to 2028, capital per worker rises by 4 units in each country. The 4-unit change in capital per worker causes productivity in Blahnik to rise by aamount than productivity in Gribinez. This illustrates theeffect.