Question

In a fictional country, 2,000 hours of labor are used in the production of all goods and services in the economy. The market values of these goods and services total $8,000
. The following year, 3,000 labor hours produce all goods and services in the economy. The market values of these goods and services total $12,000
. Assuming there is no inflation in this economy, which of the following is true?(1 point)

Labor productivity rose in both years.

Labor productivity remained the same through both years.

Labor productivity fell after the first year.

Labor productivity rose after the first year.

Answer 1

Labor productivity = output per labor hour.

Year 1: 8,000 / 2,000 = $4 per hour.
Year 2: 12,000 / 3,000 = $4 per hour.

So labor productivity remained the same through both years.