# Level III Economics Concepts

## Cobb-Douglas Production Function

The Cobb-Douglas production function is: $Y\ =\ AK^{\alpha}L^{\beta}$ where: $Y$: total real economic output (GDP) $A$: total factor productivity (TFP), a measure of the level of technology $K$: capital $L$: labor $\alpha$: the share of total output attributable to capital, known as the output elasticity of capital; note that $0\ <\ \alpha\ <\ 1$ $\beta$: […]