Assume a Cobb-Douglas Production Function Where the Share of Capital

question 30

Multiple Choice

Assume a Cobb-Douglas production function where the share of capital is 0.3 and the share of labor is 0.7.If capital grows by 1.5%, labor grows by 2%, and growth of total factor productivity is 1.2%, by how much does total output grow?

• A)4)70%
• B)3)50%
• C)3)05%
• D)2)85%
• E)1)20%

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