USX, a steel company, reduced the number of man-hours required to produce a ton of steel from 10.8 in 1982 to 3.8 in 1990, thereby eliminating 55,000 jobs. Technically, this rise in productivity means the
A. marginal product of labor increased.
B. average product of labor increased.
C. average product of capital fell.
D. marginal product of capital fell.
Answer: B
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An increase in the price of a firm's good or service shifts its demand curve for labor leftward
Indicate whether the statement is true or false
New classical economists like Robert Lucas argue that the Great Depression was primarily caused by
a. lots of mistaken expectations about the future. b. significant falls in investment. c. significant falls in the money supply. d. significant increases in taxes. e. all of the above.
A monopolistically competitive market could be considered inefficient because
a. marginal revenue exceeds average revenue. b. price exceeds marginal cost. c. the efficient scale of production is only achieved in the long run, not in the short run. d. markup pricing does not occur in any other market structure.
Starting from long-run equilibrium, a large decrease in government purchases will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; lower; potential B. expansionary; higher; potential C. recessionary; lower; potential D. recessionary; lower; lower