Parente and Prescott Provide Evidence That Total Factor Productivity Across

question 13

Multiple Choice

Parente and Prescott provide evidence that total factor productivity across countries can be explained by

• A) differences in political ideologies.
• B) differences in economic systems.
• C) differences in savings rates.
• D) barriers to technology adoption.
• E) differences in levels of human capital.

---

Definitions:

Commercial Substance

A situation where the future cash flows of an asset or business operation are expected to change significantly as a result of a transaction.

Fair Value

An estimate of the market value of an asset or liability, based on current prices in an active market.

Book Value

The net value of a company's assets found on its balance sheet, which is calculated by subtracting liabilities from the total value of assets.

Commercial Substance

An economic concept indicating that a transaction significantly alters the cash flows or financial position of an entity.