An increase in worker productivity will
A)increase aggregate supply.
B)increase aggregate demand.
C)decrease aggregate supply.
D)decrease aggregate demand.

Question

Quizplus · Accepted Answer

An increase in worker productivity means that workers are able to produce more output in a given amount of time. This leads to an increase in aggregate supply, as firms are able to produce more goods and services at a lower cost. This can lead to lower prices and higher output, which can in turn increase economic growth and create more jobs. It does not affect aggregate demand, as this is determined by other factors such as consumer spending, government spending, and investment.

An Increase in Worker Productivity Will