A decrease in the capital-labor ratio means
A)higher labor productivity because labor does more work
B)lower labor productivity because labor is working with relatively less capital
C)higher labor productivity because labor is producing less capital and more of other goods
D)lower labor productivity because more capital is available
E)higher labor productivity because more capital is available

Question

Quizplus · Accepted Answer

A decrease in the capital-labor ratio means that there is relatively less capital per worker, leading to lower labor productivity. This is because workers have access to fewer tools and resources to aid in their output.

A Decrease in the Capital-Labor Ratio Means