Labor's share of national income is equal to ________.
A)1 - b
B)WN/PY
C)(W/P)/(Y/N)
D)All of the above

Question

Quizplus · Accepted Answer

All the options represent different ways to express labor's share of national income. Option A uses a formulaic representation (1 - b), where b could represent capital's share, making 1 - b the labor's share. Option B (WN/PY) and Option C ((W/P)/(Y/N)) both represent the wage bill (W times N, where W is wages and N is the number of workers) divided by national income (P times Y, where P is the price level and Y is output), just expressed in slightly different forms.

Labor's Share of National Income Is Equal to ________