Refer to the following table when answering the following questions.
Table 4.1: Production Model's Prediction for Per Capita GDP (US = 1) (Source: Penn World Tables 9.0)
-One explanation for the difference between the predicted output per person and the observed per capita GDP in Table 4.1 is differences in:
A) the labor supply.
B) human capital.
C) per capita capital.
D) capital's share of GDP.
E) None of these answers is correct.

Question

Refer to the following table when answering the following questions.
Table 4.1: Production Model's Prediction for Per Capita GDP (US = 1)  (Source: Penn World Tables 9.0)
-One explanation for the difference between the predicted output per person and the observed per capita GDP in Table 4.1 is differences in:
A) the labor supply. 
B) human capital. 
C) per capita capital. 
D) capital's share of GDP. 
E) None of these answers is correct.

Quizplus · Accepted Answer

Human capital differences can explain variations in per capita GDP because it affects productivity and efficiency, which are not directly accounted for by the simple measures of labor and capital.

Refer to the Following Table When Answering the Following Questions