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Productivity's Effect on Unemployment

Question

Analyse how an increase in productivity can affect unemployment.

Category:

Unemployment

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Preview Answer

I. 🍃Introduction
- Definition of productivity
- Importance of productivity in economics
- Purpose of the essay

II. Positive effects of increased productivity
- Lower average costs of production
- Increased output/revenue
- Higher profits for firms
- Expansion of firms/attracting MNCs
- More employment opportunities
- Increased competitiveness in international markets
- Higher demand for labor

III. Negative effects of increased productivity
- Fewer workers needed to produce the same/more output
- Potential increase in unemployment
- Reduced demand for labor due to capital investment/better technology

IV. Impact of increased productivity on wages and consumption
- Higher productivity may lead to higher wages
- Increased consumption and demand for goods and services
- More incentive to seek employment and more employment opportunities

V. 👉Conclusion
- Summary of the positive and negative effects of increased productivity
- Importance of balancing productivity with employment opportunities
- Future implications for productivity in the global economy.

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