Question

2) •Real GDP grew at 3.3% per year •Capital’s share of income has averaged about 1/3...

2)

•Real GDP grew at 3.3% per year

•Capital’s share of income has averaged about 1/3 in the United States.

•The capital stock grew at 3.3% per year.

•The labor force grew at 1.7% per year.

The increase in real GDP per capita in the United States from 1949 to 2010

A) was due to increased labor productivity.

B) was due to an increase in the hours worked per person.

C) was due to both increased in labor productivity and an increase in hours worked per person.

D) was due to a decrease in the hours worked per person.

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Answer #1

It shall be noted that an increase in real GDP per capita in the United States from 1949 to 2010 - the data since 1947 show that long-term productivity growth rates can vary substantially between time periods, decades, and eras.

The U.S. business sector output has increased more than nine-fold since 1947 while the hours worked to produce that output have not quite doubled.

Hence, the correct option A) was due to increased labor productivity.

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