'Labour productivity' will increase if the ________ increases and ________. a. Quantity of labour per unit of capital; technological change occurs. b. Quantity of capital per hour worked; immigration increases while capital is fixed. c. Quantity of labour per unit of capital; immigration increases while capital is fixed. d. Quantity of capital per hour worked; technological change occurs.
Question
'Labour productivity' will increase if the ________ increases and ________.
a. Quantity of labour per unit of capital; technological change occurs.
b. Quantity of capital per hour worked; immigration increases while capital is fixed.
c. Quantity of labour per unit of capital; immigration increases while capital is fixed.
d. Quantity of capital per hour worked; technological change occurs.
Solution
The correct answer is:
d. Quantity of capital per hour worked; technological change occurs.
Labour productivity is a measure of economic performance that compares the amount of goods and services produced (output) with the number of hours worked to produce those goods and services. It can be increased by either increasing the amount of capital (machinery, equipment, etc.) used per hour worked, or by technological advancements that allow the same amount of output to be produced with less labor.
Option a is incorrect because increasing the quantity of labor per unit of capital would likely decrease labor productivity, not increase it. Option b and c are incorrect because while immigration increases the labor force, it does not necessarily increase labor productivity, especially if capital is fixed.
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