Capital-Output Ratio measures

The correct answer is option 'B', which states that the Capital-Output Ratio measures the amount of capital invested per unit of output. Let us understand this in detail:

Capital-Output Ratio
The Capital-Output Ratio, also known as the Capital Intensity Ratio, is a measure that relates the amount of capital invested to the quantity of output produced. It represents the efficiency with which capital is utilized in the production process.

Explanation of the Correct Answer
Option 'B' accurately describes the Capital-Output Ratio as the amount of capital invested per unit of output. This means that for every unit of output produced, a certain amount of capital is invested. The ratio is calculated by dividing the total capital invested by the quantity of output produced.

Understanding the Other Options
Let's briefly discuss the other options mentioned in the question to understand why they are incorrect:

1. Option 'A' states that the Capital-Output Ratio measures the per unit cost of production. However, the Capital-Output Ratio is not directly related to the cost of production. It is primarily concerned with the relationship between capital investment and output quantity.

2. Option 'C' suggests that the Capital-Output Ratio represents the ratio of capital depreciation to the quantity of output. While depreciation is an important factor in capital investment, it is not the sole determinant of the Capital-Output Ratio. Other factors such as initial capital investment and productivity also play a significant role.

3. Option 'D' proposes that the Capital-Output Ratio measures the ratio of working capital employed to the quantity of output. However, the Capital-Output Ratio is primarily concerned with the total capital investment, which includes both fixed capital (such as machinery and equipment) and working capital (such as raw materials and inventory). Therefore, this option does not accurately describe the Capital-Output Ratio.

Conclusion
In conclusion, the Capital-Output Ratio measures the amount of capital invested per unit of output. It provides insights into the efficiency of capital utilization in the production process. Other options such as per unit cost of production, capital depreciation ratio, and working capital ratio do not accurately define the Capital-Output Ratio.