Question

Other things equal, which of the following would increase labor productivity the most? The increase in the stock of real capital exceeds the increase in inputs of labor. The increase in inputs of labor exceeds the increase in the stock of real capital. The stock of real capital and inputs of labor increase proportionately Inputs of labor increase and the stock of real capital remains constant.

Answer 1

Answer:

The increase in the stock of real capital exceeds the increase in inputs of labor.

Explanation:

 The labor productivity refers to the amount of labor per unit of output. labor productivity increases when with the same amount of labor the output increase or the increasein labor generate an increase in output higher than proportional.

From the given options:

An increase in stock of real capital exceeding the increase in input of labor will translate into a higher productivity as each unit of labor has more capital to work with