Neutral technological progress occurs when
A)higher output levels are achieved with the same quantity and combinations of factor inputs.
B)higher output levels are achieved by more capital intensive methods.
C)higher output levels are achieved by more labor intensive methods.
D)higher output levels are achieved.

Question

Quizplus · Accepted Answer

Neutral technological progress refers to the situation where higher output levels are achieved with the same quantity and combinations of factor inputs. This means that there is no change in the relative productivity of factors such as labor, capital, and land. Instead, there is an increase in total factor productivity (TFP), which results in higher overall output levels. This type of technological progress is considered "neutral" because it does not favor any one factor input over another.

Neutral Technological Progress Occurs When