1. Aggregate economic output grows by 6% per year. Capital supply grows at 2% per year and labor supply grows at 4% per year. Capital and labor have equal factor shares. What is the growth rate of total factor productivity?

1. Aggregate economic output grows by 6% per year. Capital supply grows at 2% per year and labor supply grows at 4% per year. Capital and labor have equal factor shares. What is the growth rate of total factor productivity?

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter18: The Markets For The Factor Of Production

Section: Chapter Questions

Problem 1CQQ

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Enter your answer in the space below as a number without a percentage sign. For example, if your answer is “12%” enter “12”.___________

Definition Definition Total supply of goods and services in an economy at a certain price level in a specific time period.

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