An important source of increasing labor productivity is:

Question

Quizplus · Accepted Answer

An increase in the ratio of capital to labor typically leads to an increase in labor productivity, as workers have access to more and better tools and equipment to help them do their jobs. This is known as capital deepening. Option A is incorrect because faster growth in the labor force would increase the supply of labor, but would not necessarily increase productivity. Option B is incorrect because a decrease in the ratio of capital to labor (known as capital shallowing) would likely lead to a decrease in labor productivity. Option D is incorrect because an increase in the ratio of labor to capital would mean that there are more workers than capital, which may lead to decreased productivity due to a lack of resources for workers to use.

An Important Source of Increasing Labor Productivity Is