According to the neoclassical theory of distribution, in an economy described by a Cobb-Douglas production function, when average labor productivity is growing rapidly:

1. workers will experience high rates of real wage growth.

2. labor's share of total income will be increasing.

3. economic profits will be positive.

4. labor's share of income will be decreasing.

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Business

Briley

5 October, 05:43

According to the neoclassical theory of distribution, in an economy described by a Cobb-Douglas production function, when average labor productivity is growing rapidly:

1. workers will experience high rates of real wage growth.

2. labor's share of total income will be increasing.

3. economic profits will be positive.

4. labor's share of income will be decreasing.

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Answers (1)

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Jamie Barber · Answer 1

All of the above

Explanation:

According to the neoclassical theory of distribution, in an economy described by a Cobb-Douglas production function, when average labor productivity is growing rapidly: workers will experience high rates of real wage growth. labor's share of total income will be increasing. labor's share of income will be decreasing.