The Next Questions Refer to the Following

question 25

Multiple Choice

The next questions refer to the following.
Suppose the economy has TFP = 10, there are 400 hours worked, and 60 unit of capital and 210 units of land the Cobb-Douglas production function is:
Output = TFP x Hours^0.3 x Capital^0.3 x Land^0.2.
-If total factor productivity grows by 1% per year while capital and labor each grow by 2% per year,then output grows by

• A) 2.2% per year
• B) 3% per year
• C) 5% per year
• D) 1.67% per year
• E) 4% per year

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Definitions:

Systematic errors

Errors that consistently occur in the same direction every time a measurement is made, affecting the accuracy of results across a dataset.

Heuristics

Cognitive shortcuts or rules of thumb that simplify decision making by reducing complex problem-solving to simpler judgment processes.

Ethical implications

The moral consequences or considerations arising from actions, decisions, or policies in personal, professional, or organizational contexts.

Decision entrapment

A situation where individuals continue to invest in a decision despite new evidence suggesting it may have been the wrong choice.