{"id":54992,"date":"2024-04-16T00:19:45","date_gmt":"2024-04-16T00:19:45","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=54992"},"modified":"2024-04-16T00:19:45","modified_gmt":"2024-04-16T00:19:45","slug":"suppose-that-output-y-is-a-function-of-capital-k-then-the-capital-elasticity-of-output-is-given-by","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/suppose-that-output-y-is-a-function-of-capital-k-then-the-capital-elasticity-of-output-is-given-by\/","title":{"rendered":"Suppose that output (Y) is a function of capital (K); then the capital-elasticity of output is given by"},"content":{"rendered":"<p>\r\n    <!-- Check if it's an AMP page -->\r\n            <!-- Non-AMP version -->\r\n        <div class=\"mcq-container\" data-quiz-id=\"quizState_6a97dc840c6e2\">\r\n                                            <div class=\"option\" data-option-key=\"option1\" data-is-correct=\"true\">\r\n                    $$\frac{{M{P_k}}}{{A{P_k}}}$$                <\/div>\r\n                                            <div class=\"option\" data-option-key=\"option2\" data-is-correct=\"false\">\r\n                    $$\frac{{A{P_k}}}{{M{P_k}}}$$                <\/div>\r\n                                            <div class=\"option\" data-option-key=\"option3\" data-is-correct=\"false\">\r\n                    $$\frac{Y}{K}$$                <\/div>\r\n                                            <div class=\"option\" data-option-key=\"option4\" data-is-correct=\"false\">\r\n                    None of these                <\/div>\r\n                            \r\n            <!-- Feedback messages for non-AMP -->\r\n            <div class=\"feedback\" data-feedback=\"wrong\">Answer is Right!<\/div>\r\n            <div class=\"feedback\" data-feedback=\"right\">Answer is Wrong!<\/div>\r\n        <\/div>\r\n\r\n        <script>\r\n        document.addEventListener('DOMContentLoaded', function () {\r\n            var containers = document.querySelectorAll('.mcq-container');\r\n\r\n            containers.forEach(function(container) {\r\n                var options = container.querySelectorAll('.option');\r\n                var feedbackSelect = container.querySelector('[data-feedback=\"select\"]');\r\n                var feedbackWrong = container.querySelector('[data-feedback=\"wrong\"]');\r\n                var feedbackRight = container.querySelector('[data-feedback=\"right\"]');\r\n\r\n                options.forEach(function(option) {\r\n                    option.addEventListener('click', function() {\r\n                        var selectedOption = option.getAttribute('data-option-key');\r\n                        var isCorrect = option.getAttribute('data-is-correct') === 'true';\r\n\r\n                        \/\/ Remove previous selections\r\n                        options.forEach(function(opt) {\r\n                            opt.classList.remove('correct', 'incorrect');\r\n                        });\r\n\r\n                        \/\/ Add the correct\/incorrect class\r\n                        if (isCorrect) {\r\n                            option.classList.add('correct');\r\n                            feedbackRight.hidden = false;\r\n                            feedbackWrong.hidden = true;\r\n                        } else {\r\n                            option.classList.add('incorrect');\r\n                            feedbackRight.hidden = true;\r\n                            feedbackWrong.hidden = false;\r\n                        }\r\n\r\n                        \/\/ Hide select feedback\r\n                        feedbackSelect.hidden = true;\r\n                    });\r\n                });\r\n            });\r\n        });\r\n        <\/script>\r\n    \r\n    <!--more--><\/p>\n<p>The correct answer is $\\boxed{\\frac{Y}{K}}$.<\/p>\n<p>The capital-elasticity of output is a measure of how much output changes in response to a change in capital. It is calculated by taking the percentage change in output and dividing it by the percentage change in capital.<\/p>\n<p>In mathematical terms, the capital-elasticity of output is given by:<\/p>\n<p>$$\\epsilon_k = \\frac{\\frac{\\Delta Y}{Y}}{\\frac{\\Delta K}{K}}$$<\/p>\n<p>where $\\Delta$ denotes a change in a variable.<\/p>\n<p>If the capital-elasticity of output is greater than 1, then output increases by more than the percentage increase in capital. This means that capital is a relatively important input in the production process.<\/p>\n<p>If the capital-elasticity of output is less than 1, then output increases by less than the percentage increase in capital. This means that capital is a relatively unimportant input in the production process.<\/p>\n<p>If the capital-elasticity of output is equal to 1, then output increases by the same percentage as capital. This means that capital is a neutral input in the production process.<\/p>\n<p>The capital-elasticity of output is an important concept in economics because it helps us to understand how changes in capital affect output. It is also used in economic models to predict how the economy will respond to changes in capital investment.<\/p>\n<p>The other options are incorrect because they do not measure the capital-elasticity of output.<\/p>\n<p>Option A is the marginal product of capital. The marginal <div class=\"telegram-channel-container\">\r\n        <a href=\"https:\/\/t.me\/pscnotes2025\" target=\"_blank\" class=\"telegram-channel-button\">\r\n            <span class=\"telegram-icon\">\r\n                <svg xmlns=\"http:\/\/www.w3.org\/2000\/svg\" viewBox=\"0 0 496 512\">\r\n                    <path fill=\"white\" d=\"M248,8C111,8,0,119,0,256s111,248,248,248s248-111,248-248S385,8,248,8z M362,177L320,367c-3,14-10,18-20,14l-56-41l-27,26 c-3,3-5,5-10,5l4-63L323,196c5-5-1-7-8-3l-98,62l-42-13c-9-3-10-9,2-14l162-63C351,160,365,164,362,177z\"\/>\r\n                <\/svg>\r\n            <\/span>\r\n            Join Our Telegram Channel\r\n        <\/a>\r\n    <\/div> product of capital is the additional output that is produced when one more unit of capital is added to the production process.<\/p>\n<p>Option B is the average product of capital. The average product of capital is the total output produced divided by the amount <div class=\"youtube-subscribe-container\">\r\n        <a href=\"https:\/\/www.youtube.com\/channel\/UCNHT8lW-JmLC68rjBfZhdkg?sub_confirmation=1\" target=\"_blank\" class=\"youtube-subscribe-button\">\r\n            <span class=\"youtube-icon\">\r\n                <svg xmlns=\"http:\/\/www.w3.org\/2000\/svg\" viewBox=\"0 0 576 512\">\r\n                    <path d=\"M549.7 124.1c-6.3-23.7-24.8-42.3-48.3-48.6C458.8 64 288 64 288 64S117.2 64 74.6 75.5c-23.5 6.3-42 24.9-48.3 48.6-11.4 42.9-11.4 132.3-11.4 132.3s0 89.4 11.4 132.3c6.3 23.7 24.8 41.5 48.3 47.8C117.2 448 288 448 288 448s170.8 0 213.4-11.5c23.5-6.3 42-24.2 48.3-47.8 11.4-42.9 11.4-132.3 11.4-132.3s0-89.4-11.4-132.3zm-317.5 213.5V175.2l142.7 81.2-142.7 81.2z\"\/>\r\n                <\/svg>\r\n            <\/span>\r\n            Subscribe on YouTube\r\n        <\/a>\r\n    <\/div> of capital used.<\/p>\n<p>Option C is the capital-output ratio. The capital-output ratio is the amount of capital that is used to produce one unit of output.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Subscribe on YouTube<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.2 (Yoast SEO v23.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Suppose that output (Y) is a function of capital (K); then the capital-elasticity of output is given by<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/exam.pscnotes.com\/mcq\/suppose-that-output-y-is-a-function-of-capital-k-then-the-capital-elasticity-of-output-is-given-by\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Suppose that output (Y) is a function of capital (K); 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