AP MacroeconomicsEconomic Growth
Productivity
Productivity is the amount of output produced per unit of input, most often output per worker or per hour worked.
Rising productivity is the main long-run source of economic growth and higher living standards. It increases from better technology, more capital per worker, and improved human capital. Higher productivity shifts long-run aggregate supply to the right.
Formula / Example
Labor productivity = Total output ÷ Total labor hours.
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