Enter the average annual share of investment in GDP and the average annual growth rate of GDP into the Calculator. The calculator will evaluate the Capital Output Ratio. 

Capital Output Ratio Formula

ICOR = I / G

Variables:

  • ICOR is the Capital Output Ratio ()
  • I is the average annual share of investment in GDP
  • G is the average annual growth rate of GDP

To calculate Capital Output Ratio, divide the average annual share of investment in GDP by the average annual growth rate of the GDP.

How to Calculate Capital Output Ratio?

The following steps outline how to calculate the Capital Output Ratio.

  1. First, determine the average annual share of investment in GDP. 
  2. Next, determine the average annual growth rate of GDP. 
  3. Next, gather the formula from above = ICOR = I / G.
  4. Finally, calculate the Capital Output Ratio.
  5. After inserting the variables and calculating the result, check your answer with the calculator above.

Example Problem : 

Use the following variables as an example problem to test your knowledge.

average annual share of investment in GDP = 2.5

average annual growth rate of GDP = 5