Final answer:
It does not focus solely on digital advancements, and machinery and tools are not excluded from the concept of technology.
Step-by-step explanation:
In the context of the aggregate production function, the concept of technology differs from our everyday use of the word. Everyday technology typically refers to gadgets and devices, but in the aggregate production function, technology refers to alternative methods of combining inputs to produce outputs. It does not refer to a specific new invention, but rather encompasses all methods of production.
Furthermore, the aggregate production function includes human capital as part of the technology. Human capital refers to the knowledge, skills, and abilities of the workforce, which contribute to the production process. In contrast, our everyday use of the word 'technology' often focuses on digital advancements.
Lastly, the aggregate production function does not exclude machinery and tools as part of the technology. In fact, physical capital and labor can often substitute for each other in the production process, giving firms the choice of different combinations of labor and physical capital.