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Output, total hours worked, and average labor productivity all are procyclical. Which variable, output or total hours worked, increases by a larger percentage in expansions falls by a larger percentage in recessions? (Hint: Average labor productivity = output ÷total hours worked, so that the percentage change in average labor productivity equals the percentage change in output minus the percentage change in total hours worked).

Microeconomics, Economics

  • Category:- Microeconomics
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