A temporary beneficial productivity shock would
A)shift the labor supply curve down and to the right.
B)increase the level of employment.
C)increase future income.
D)increase the expected future marginal product of capital.

Question

Quizplus · Accepted Answer

A temporary beneficial productivity shock would increase the level of employment, as firms would need to produce more to meet the increase in demand. This would lead to an increase in production and output in the short term. However, it would not necessarily shift the labor supply curve or increase future income or the expected future marginal product of capital.

A Temporary Beneficial Productivity Shock Would