In a firm, if the employees attend a training program, then the time to assemble one unit reduces by 10%.Training program will
A)increase the labor productivity only
B)increase the multifactor productivity only
C)increase both labor and multifactor productivity
D)decrease capital productivity
E)have no effect on productivity.

Question

Quizplus · Accepted Answer

The training program improves the skills and knowledge of the employees, resulting in a decrease in the time taken to assemble one unit. As a result, labor productivity increases. Additionally, since the training program improves the overall efficiency of the assembly process, it also improves the multifactor productivity, which is a measure of the output compared to all inputs, including labor, capital, and materials. Therefore, both labor and multifactor productivity increase as a result of the training program.

In a Firm, If the Employees Attend a Training Program