Suppose that capital per hour of labor grew enough to increase GDP per hour of labor by 3 percent. Then, using the one- third rule, the growth in capital per hour of labor must have been

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The one-third rule states that a 1% increase in capital per hour of labor leads to a 1/3% increase in GDP per hour of labor. Therefore, to achieve a 3% increase in GDP per hour of labor, capital per hour of labor must have grown by 9% (since 9% * 1/3 = 3%).

Suppose That Capital Per Hour of Labor Grew Enough to Increase