Question

To reduce the Investment and the Incremental capital output ratio the following
approaches are to be accomplished
I. Static efficiency
II.
Dynamic efficiency
III.
Allocative efficiency
IV.
Technical efficiency​

Answer 1

Technical efficiency is used to reduce the Investment and the Incremental capital-output ratio.

Option (IV) is correct.

Explanation:

• Technical efficiency is used to increase the effectiveness of a firm.
• This efficiency is a set of effective and efficient inputs that are used to produce effective outputs.
• If the inputs or investment are minima and the output or capital ratio is maximum then the firm is said to be efficient.
• The minimum inputs are capital, labor, and technology.