Suppose That Growth in Output That Can Be Attributed to Growth

question 116

Multiple Choice

Suppose that growth in output that can be attributed to growth in labor and capital is 3%. If output grows at a rate of 5%, it must be the case that:

• A) the economy is not spending enough on acquiring human capital.
• B) growth in capital exceeds growth in labor.
• C) both labor and capital are becoming more productive.
• D) growth in labor exceeds growth in capital.

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Definitions:

Mean

The arithmetic average of a set of numbers, calculated by adding all the numbers together and dividing by the count of the numbers.

Table

A method for organizing data in rows and columns to facilitate analysis and representation.

Probabilities

A calculation that determines the chances of an event occurring, with values between 0 and 1 to signify probability.

t-Table

A table used in statistics that shows the critical values of the t-distribution, used in hypothesis testing and constructing confidence intervals.