If Average Labor Productivity Decreases While Population and the Number

question 14

Multiple Choice

If average labor productivity decreases while population and the number of employed workers remain constant, then output per person:

• A)increases.
• B)decreases.
• C)remains constant.
• D)may increase or decrease.

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Definitions:

Price Floor

Price Floor is a government or regulatory-imposed minimum price set above the equilibrium price, preventing the price of a good or service from falling below it.

Equilibrium Price

The price at which the quantity of a good or service demanded equals the quantity supplied, resulting in market balance.

Surplus

A situation where the quantity of a product or service supplied exceeds the quantity demanded at the current price.

Maximum Price

A price ceiling set by the government or another regulatory body, beyond which prices cannot legally rise for essential goods or services.