Productivity growth is important because:
A)it is the only way an economy can increase GDP.
B)a small decrease in productivity growth causes a large decline in GDP.
C)a large increase in productivity growth causes a small decrease in GDP.
D)it causes an increase in the quantity of all resources available to an economy.
E)it ultimately increases a nation's standard of living.

Question

Quizplus · Accepted Answer

Productivity growth leads to increased output using the same amount of resources, which ultimately leads to an increase in a nation's standard of living. This is because it allows for more goods and services to be produced per unit of input, leading to higher wages, profits, and overall economic growth. Options A, B, and D are incorrect as they do not fully capture the importance of productivity growth in relation to economic growth and development.

Productivity Growth Is Important Because