In the production function ,
Represents:
A) an unknown.
B) the amount of capital in an economy.
C) the amount of labor in an economy.
D) a productivity parameter.
E) an error term.

Question

In the production function  , 
Represents:
A) an unknown. 
B) the amount of capital in an economy. 
C) the amount of labor in an economy. 
D) a productivity parameter. 
E) an error term.

Quizplus · Accepted Answer

The variable e represents a productivity parameter, which affects the output of the production function. The other variables, a and b, represent inputs of capital and labor, respectively.

In the Production Function