Economists are concerned about a slowdown in productivity because of the risk of higher inflation rates and a(n)
A) loss of our ability to diversify in manufacturing.
B) increased dependence on imported raw materials.
C) decline in service industries that depend on microelectronics technology.
D) potential decline in technological change that could affect our future rate of growth.
E) fear that it will lead to an influx of unskilled workers replacing domestic workers.

Question

Quizplus · Accepted Answer

Productivity growth is a major driver of technological change, which in turn affects our future rate of growth. A slowdown in productivity growth could lead to a decline in technological change, reducing our potential for long-term economic growth. This can put pressure on inflation rates because businesses may have to pay more for less efficient processes or inputs.

Economists Are Concerned About a Slowdown in Productivity Because of the Risk