Question

Labor productivity equals the average product of labor. determines the real standard of living for a country. growth depends on growth in the stock of capital. All of the above are true?

1) equals the average product of labor.
2) determines the real standard of living for a country.
3) growth depends on growth in the stock of capital.
4) All of the above are true.

Answer 1

Labor productivity is the value that each employed person creates per unit of their input, determining the real standard of living for a country. Growth in labor productivity depends on growth in the stock of capital. All of the given statements are true.

Step-by-step explanation:

Labor productivity is the value that each employed person creates per unit of their input. It measures how efficient a nation is with its time and workers. For example, if a Canadian worker can produce 10 loaves of bread in an hour while a U.S. worker can only produce 2 loaves in the same time, the Canadians are more productive.

Labor productivity is important for economic growth as it determines the real standard of living for a country. When workers are more productive, they can produce more goods and services, which leads to higher GDP per capita and higher wages.

Growth in labor productivity also depends on growth in the stock of capital, including investments in physical capital like machinery, equipment, and technology. The more capital a country has, the more productive its workers can be.

Therefore, All of the above statements are true: labor productivity equals the average product of labor, it determines the real standard of living for a country, and growth depends on growth in the stock of capital.