Total factor productivity is the ratio of a:
A)firm's marginal revenue to its marginal cost.
B)firm's total revenues to its total costs.
C)nation's total income to its total output.
D)nation's output to its stock of labor and capital.
E)nation's savings to its capital stock.

Question

Quizplus · Accepted Answer

Total factor productivity (TFP) is the ratio of output (nation's output) to inputs (stock of labor and capital). It measures the efficiency with which inputs are used in the production process. Marginal revenue to marginal cost is a measure of the profit-maximizing level of output for a firm, while total revenues to total costs is a measure of a firm's profitability. The nation's total income to its total output ratio is the average income per unit of output, while savings to capital stock is the savings rate.

Total Factor Productivity Is the Ratio of A