📚 Learning Guide
Economic Productivity Classification
easy

Which of the following best describes capital productivity in the context of economic productivity classification?

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Choose the Best Answer

A

The output produced per unit of capital used

B

The total output produced by a workforce

C

The efficiency of land use in agriculture

D

The relationship between income and consumption

Understanding the Answer

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Answer

Capital productivity refers to how effectively a business uses its capital, like machinery and buildings, to produce goods or services. It measures the output generated for each unit of capital invested. For example, if a factory uses a million dollars worth of equipment and produces 500,000 widgets, the capital productivity would be 0. 5 widgets per dollar of capital. High capital productivity means that the business is getting a lot of output for the amount of money spent on equipment, which is important for profitability and growth.

Detailed Explanation

Capital productivity measures how much output we get from the capital we use. Other options are incorrect because This option talks about the total output from workers, not capital; This choice is about land use in farming, not capital.

Key Concepts

capital productivity
Topic

Economic Productivity Classification

Difficulty

easy level question

Cognitive Level

understand

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