Question

Because of its effect on the amount of capital per worker, in the short term an increase in the working population is likely to

a. reduce productivity. Other things the same, this decrease will be larger in a rich country.

b. reduce productivity. Other things the same, this decrease will be larger in a poor country.

c. raise productivity. Other things the same, this increase will be larger in a poor country.

d. raise productivity. Other things the same, this increase will be larger in a rich country.

Answer 1

The correct answer is letter "B": reduce productivity. Other things the same, this decrease will be larger in a poor country.

Step-by-step explanation:

Labor productivity measures the units a worker can produce per hour. Capital, technology, and human development influence the labor productivity employees could have. Poor countries are characterized by having low investments. If the labor force increases but the capital remains stagnant, the level of productivity is likely to fall since there is a surplus in labor hand.