capital output ratio


The ratio of capital used to produce an output over a period of time. This ratio has a tendency to be high when capital is cheap as compared to other inputs. For instance, a country with abundant natural resources can use its resources in lieu of capital to boost its output, hence the resulting capital output ratio is low.

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You should try to break down your capital output ratio so that you know how much you are spending at all times.

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I could not determine the capital output ratio, so I had my friend work with it instead of me, which was the best idea.

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The capital output ratio was the most useful metric for our project because our concerns were with efficiency of inputs.

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