In calculating multifactor productivity growth,the elasticity of output to changes in capital (given as "b" in the textbook)is assumed to be
A)one minus the population growth rate.
B)the depreciation rate.
C)the share of capital income in GDP.

Question

Quizplus · Accepted Answer

The elasticity of output to changes in capital, denoted as "b," is assumed to be the share of capital income in GDP. This reflects the proportion of total economic output that is attributable to the use of capital in the production process.

In Calculating Multifactor Productivity Growth,the Elasticity of Output to Changes