Which of the Following Increases Total Factor Productivity

question 45

Multiple Choice

Which of the following increases total factor productivity?

• A) investment in machinery
• B) a harsh winter
• C) better access to credit
• D) new production procedures

---

Definitions:

MPC

The Marginal Propensity to Consume, representing the proportion of any additional income that a consumer spends on goods and services, as opposed to saving it.

Crowding Out

The phenomenon where increased government spending leads to a reduction in private sector investment, due to higher interest rates or the consumption of financial resources.

Aggregate Demand

The aggregate need for goods and services in an economy at a specific price level and during a certain time frame.

Constitutional Amendment

A formal change or addition proposed to a constitution, which then requires ratification to become part of the document.