Suppose than an economy has output Y = A , that Y equals $19 trillion, capital K is $27 trillion, and labor L is 125 million workers. Given this information, what is the closest approximation of total factor productivity A?
A) less than 0.01
B) around 0.25
C) roughly 0.33
D) close to 0.4
E) exactly 144
B
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In a perfectly competitive labor market
a. all firms are wage takers b. all firms are wage searchers c. all firms sell their output at a constant price d. none of the firms that demand labor can be monopolists e. some firms may be able to influence the wage rate as long as most firms cannot
The invention of machinery that can double the amount of gold extracted from raw ore will likely lead mining companies to
a. raise the world price of gold to pay for the new machinery. b. lower the world price of gold because any amount can now be produced more cheaply. c. raise the world price of gold because miners' wages must double as their productivity doubles. d. lower the world price of gold only if new mining companies are not allowed to enter the industry.