Apart from the ratio of capital formation to the aggregate
national income , the growth of output depends upon the capital –output
ratio’s. The capital -output depends
upon the capital output ratio. The capital output ratio may be defined a the
relationship of investment in a given economy or industry for a given time
period to the output of that economy or industry for a similar time period. The
capital output ratio thus determines the rate at which output grows as a result
of a given volume of capital investment than a higher capital output ratio.
From the reference above
ReplyDeleteA high capital output ratio means
(a) Low amount of capital needed for a unit of production
(b) Large amount of capital needed for a unit of production
(c) Same amount of capital needed for production
(d) Increasing trend of capital use
I'll be glad with you if i receive right answer with reason
A low amt of capital reqired for a unit of production
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