Explain the relationship between economic growth and labor productivity
What will be an ideal response?
Economic growth equals the sum of the growth rates of all inputs plus the rate of growth in the productivity of the inputs. Hence, other things constant, an increase in labor productivity leads to an increase in economic growth.
You might also like to view...
Figure 4.2 illustrates the supply and demand for t-shirts. If the actual price of t-shirts is $15, we would expect that
A) price will decrease until quantity demanded equals quantity supplied. B) supply will increase until quantity demanded equals quantity supplied. C) demand will decrease until quantity demanded equals quantity supplied. D) there will be no change in the price since the market is in equilibrium.
If a household has $40,000 in taxable income and its tax liability is $20,000, the household's average tax rate is
a. 10 percent. b. 25 percent. c. 40 percent. d. 50 percent
Suppose a nation reduced taxes by $20 billion. The direct change in the monetary base would be:
a. Equal to +$20 billion because the government pumps new money into the economy when it lowers taxes. b. Greater than +$20 billion because the M2 money multiplier would inflate the $20 billion of new monetary base. c. Equal to $0. d. Equal to $20 billion times the reserve ratio on checking accounts. e. Less than $20 billion because some of the newly created funds would leak into the system in the form of currency in circulation.
The ________ the sale of an additional unit of a product is a marginal benefit to the firm
A) revenue received from B) extra cost of C) total value of D) sales tax on