Employment will remain constant as a result of an increase in productivity when which of the following occurs?
A) Productivity growth exceeds output growth.
B) Productivity growth is equal to output growth.
C) Output growth exceeds productivity growth.
D) The AS curve shifts downward.
E) The AD curve shifts to the right.

Question

Quizplus · Accepted Answer

When productivity growth is equal to output growth, employment levels can remain constant because the amount of work required to produce the output does not change relative to the efficiency of production.

Employment Will Remain Constant as a Result of an Increase