If both total employment and total output in an economy grow by 2 percent each year,then the annual growth in labor productivity in the economy over a decade will be equal to _____.
A)0 percent
B)2 percent
C)10 percent
D)20 percent
E)2 percent times the size of the labor force

Question

Quizplus · Accepted Answer

Labor productivity is defined as output per unit of labor. If both total employment and total output grow by the same percentage (2% in this case), the ratio of output to employment (labor productivity) remains unchanged, indicating 0 percent growth in labor productivity.

If Both Total Employment and Total Output in an Economy