The total real return paid to capital owners is calculated using which formula?

The correct approach to calculating the total real return paid to capital owners is through the formula that identifies the marginal product of capital (MPK) multiplied by the quantity of capital (K). This is based on the principle that capital owners receive income in proportion to the additional output generated by their capital.

In more detail, MPK represents the additional output produced by an additional unit of capital. When this additional output is monetized through the total quantity of capital owned (K), it gives us the earnings attributable to capital. Therefore, the multiplication of MPK and K allows for the assessment of the total return that goes to the owners of capital, reflecting their contribution to production in the economy.

Contextually, the other options relate to different factors of production or misinterpret the calculation of total returns. For instance, the marginal product of labor (MPL) as seen in other choices is applicable to labor returns rather than capital. The options that involve subtracting from total output (Y) would not accurately represent returns as they misrepresent how the earnings structure works in macroeconomic theory. Hence, focusing on MPK x K is the definitive method for identifying the total real return to capital.