Would an increase in the productivity of labor lead to an increase or a decrease in the demand for labor? Why?
An increase in productivity would lead to an increase in the marginal revenue product of labor. With a higher marginal revenue product we would expect to see an increase in demand. A firm would be likely to utilize more labor and less of other resources if labor has become more productive.
You might also like to view...
Which of the following was NOT a part of the American system of manufacturing?
(a) Interchangeable and standardized parts (b) Use of indentured servants (c) Mass production (d) High capital intensities of production
The flawed character cause of poverty refers to individual defects in aspiration or ability
Indicate whether the statement is true or false
Which of the following is the main reason for externalities?
A) The full cost of a transaction is not borne by the buyer/seller of the product. B) Police enforcement of scalping is not uniformly enforced. C) the lack of organized exchanges for all goods and services D) The production of public goods uses up scarce resources.
Older Americans living on a pension and therefore on a fixed income, tend to be made
a. better off when prices rise. b. better off when the inflation rate rises. c. worse off when prices rise. d. worse off when prices fall.