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Explain the reasons why productivity may fall.

Quick Answer:

There may be a decline in the quantity or quality of education and training. Less skilled workers may produce lower quality products and lower output.

There may be a decline in investment. Consequently, workers will work with less equipment. This may lead to a significant fall in output.

A decline in wage rates will reduce workers’ motivation. Worse working conditions which will reduce job satisfaction

A rise in working hours making workers more tired. Work may become more repetitive

Higher tax rates in a country may reduce workers’ motivation.

Poorer healthcare in a country reducing workers’ physical strength or mental alertness

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