If total factor productivity increases by 2 percent and total resource growth equals 2 percent, then total output grows by
A) 0 percent.
B) 2 percent.
C) 4 percent.
D) 6 percent.
E) 8 percent.

Question

Quizplus · Accepted Answer

Total output growth can be approximated by the sum of the growth rates of total factor productivity and total resource growth. Therefore, 2% (from total factor productivity) + 2% (from total resource growth) = 4%.

If Total Factor Productivity Increases by 2 Percent and Total