The reason why productivity growth is so important is that
A)it is the key to long-run increases in the standard of living
B)per capita GDP ultimately depends on labor productivity
C)total GDP cannot increase without increases in resource productivity levels
D)all of the above
E)both a and b

Question

Quizplus · Accepted Answer

Productivity growth is important because it leads to increases in the standard of living over the long run, which is achieved by increasing per capita GDP. Therefore, both options A and B are correct, making E the best choice. Option C is incorrect because increases in total GDP can also be achieved through increases in resources, such as labor or capital, not just productivity levels.

The Reason Why Productivity Growth Is So Important Is That