Labor productivity increases if i. human capital decreases.
Ii. technology advances.
Iii. quality of education decreases.

Question

Quizplus · Accepted Answer

Labor productivity is directly related to the level of technology advancement. As technology improves, workers are equipped with better tools and systems to help them work efficiently, which increases productivity. However, human capital (the knowledge and skills workers possess) is also critical to productivity, and decreasing it would likely have a negative impact on productivity. Similarly, a decrease in the quality of education would negatively affect human capital, and ultimately productivity, making option iii incorrect.

Labor Productivity Increases If I. Human Capital Decreases