If the contribution from capital and labor growth in a given economy equals 4.0 percent and output growth equals 6.4 percent over that same period of time,then productivity growth must equal ________.
A)25.6 percent
B)10.4 percent
C)2.4 percent
D)1.6 percent

Question

Quizplus · Accepted Answer

Productivity growth can be calculated as the difference between output growth and the contribution from capital and labor growth. Thus, productivity growth = output growth - (contribution from capital and labor growth) = 6.4% - 4.0% = 2.4%. Therefore, the answer is C.

If the Contribution from Capital and Labor Growth in a Given