Suppose that in Chile total annual output is worth $600 million and people work 70 million hours.In Argentina total annual output is worth $450 million and people work 40 million hours.Productivity is higher
A) in Chile.Most variation in the standard of living across countries is due to differences in productivity.
B) in Chile.Differences in productivity explain very little of the variation in the standard of living across countries.
C) in Argentina.Most variation in the standard of living across countries is due to differences in productivity.
D) in Argentina.Differences in productivity explain very little of the variation in the standard of living across countries.

Question

Quizplus · Accepted Answer

Productivity is calculated as output per hour worked. In Chile, productivity is $600 million / 70 million hours = $8.57 per hour. In Argentina, productivity is $450 million / 40 million hours = $11.25 per hour. Therefore, productivity is higher in Argentina. Most variation in the standard of living across countries is due to differences in productivity.

Suppose That in Chile Total Annual Output Is Worth $600