If the capital stock remains fixed while the supply of labor increases, it is likely that
A) the productivity of labor will rise.
B) the productivity of labor will fall.
C) the productivity of labor will not change.
D) output per capita will rise.

Question

Quizplus · Accepted Answer

If the supply of labor increases while the capital stock remains fixed, it is likely that the productivity of labor will fall. This is because there will be insufficient capital to support the increased labor force, leading to a decrease in efficiency and output per worker. This will result in a decline in overall productivity of labor.

If the Capital Stock Remains Fixed While the Supply of Labor