Multiple Choice QuestionWhich of the following is true concerning resource productivity and demand?Multiple choice question.A decrease in productivity of a resource reduces demand for the resource, but a decrease in demand for the resource does not affect the productivity.An increase in the productivity of a resource will increase the demand for the resource and vice versa.An increase in the productivity of a resource will reduce the demand for the resource and vice versa.A decrease in the productivity of a resource will increase the demand for the resource and vice versa.
Question
Multiple Choice QuestionWhich of the following is true concerning resource productivity and demand?Multiple choice question.A decrease in productivity of a resource reduces demand for the resource, but a decrease in demand for the resource does not affect the productivity.An increase in the productivity of a resource will increase the demand for the resource and vice versa.An increase in the productivity of a resource will reduce the demand for the resource and vice versa.A decrease in the productivity of a resource will increase the demand for the resource and vice versa.
Solution
The correct answer is: An increase in the productivity of a resource will increase the demand for the resource and vice versa.
This is because when the productivity of a resource increases, it means that more output can be produced with the same amount of input. This makes the resource more valuable, which increases the demand for it. Conversely, if the demand for a resource increases, it incentivizes producers to find ways to increase the productivity of the resource to meet the increased demand.
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