If an Economy Has 9,000 Workers with Each Working 2,000

question 9

Essay

If an economy has 9,000 workers with each working 2,000 hours per year and the average real output per worker-hour is $20, what is real GDP?

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Definitions:

Fixed Inputs

Resources or factors of production that cannot be easily increased or decreased in the short term, such as buildings or machinery.

Marginal Product

The additional output resulting from a one unit increase in a particular input, holding other inputs constant.

Labor

The effort by workers to produce goods or provide services in exchange for payment.

Capital

Assets used in the production of goods and services, often categorized as physical (like machinery) or financial (like money at hand).