what results when firms are able to increase the amount of physical capital available to workers?

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what results when firms are able to increase the amount of physical capital available to workers?

economics

2007-04-15 08:52:33 · 2 answers · asked by Anonymous in Social Science ➔ Economics

2 answers

What happens if the people working in your factory get more and/or better equipment and machines? Would their productivity go up or down? (Productivity is measured by unit of output per unit of labor.)

2007-04-15 09:39:42 · answer #1 · answered by Bjorkmeister 5 · 0⤊ 0⤋

They buy better machines to make more product with the existing workforce ( Increase Effficiency), or they hire more people to use the existing equipment to make more product (Increase Capacity). Either way the increase in product should in turn lead to increased sales and profits.

2007-04-16 00:33:31 · answer #2 · answered by righteousjohnson 7 · 0⤊ 0⤋