In the production function,Y = zF(K,Nd),total factor productivity is
A) Y/K.
B) Y/ Nd.
C) F/Y.
D) z.
E) Y/Z.

Question

Quizplus · Accepted Answer

Total factor productivity is captured by the parameter z in the production function. It represents the level of technology or efficiency in combining capital and labor inputs to produce output. Therefore, the correct choice is D. Choices A, B, and C are incorrect as they do not capture the essence of total factor productivity. Choice E is incorrect as it divides the output by an unknown variable Z, which is not defined in the context of the production function.

In the Production Function,Y = ZF(K,Nd),total Factor Productivity Is