Question

Which statement best describes how human capital impacts production costs?

A) An employer invests in technology training for his staff and immediately sees an increase in productivity that reduces his need to pay over time.


B) A company hires one hundred new employees to help with a sales campaign but must lay off a third of them due to a human resources error.


C) A company decides to provide all employees with company-paid insurance benefits to entice more people to work for the company rather than a competitor.


D) An employer lays off half his staff due to his acquisition of an expensive technological device that changes the way his product will be manufactured to ensure uniformity.

Answer 1

A) An employer invests in technology training for his staff and immediately sees an increase in productivity that reduces his need to pay over time best describes how human capital impacts production costs. By investing in employee training and development, an employer can improve the skills and knowledge of the workforce, leading to increased productivity, efficiency, and quality of work. This can ultimately result in a reduction in production costs as the workforce becomes more skilled and capable of producing more output in less time, requiring fewer resources and lowering costs.