The Next Questions Refer to the Following

question 3

Multiple Choice

The next questions refer to the following.
Suppose the economy has TFP = 10, there are 400 hours worked, and 9 unit of capital and the Cobb-Douglas production function is .
-If total factor productivity grows by 1% per year while capital and labor each grow by 2% per year,then output grows by

• A) 1.5% per year
• B) 3% per year
• C) 5% per year
• D) 1.67% per year
• E) 4% per year

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