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The Labor Market — End of Chapter Problem
The number of bank tellers declined from an aver-age of 20 per branch in 1988 to 13 in 2004, as ATMs replaced human tellers. This meant that the cost of running each branch fell. Banks responded by increasing the number of urban bank branches by 43% in the same time period, which increased the total number of bank employees. So ATMs shifted employees' work from routine tasks like deposits and withdrawals towards skills machines cannot provide, such as sales and customer service.
When the use of ATMs became more prevalent, reducing the banks' overall costs, the ______ was dominant. On net, labor and capital would be considered _______ in this industry.

Sagot :

Answer: scale effect; complement

Explanation:

When the use of ATMs became more prevalent, reducing the banks' overall costs, the (scale effect) was dominant while on net, labor and capital would be considered (complement) in this industry.

Labor and Capital are regarded as complement because they work alongside each other. The ATM machines can only work with the labor available who operates it. Therefore, they go hand in hand as one can't function without the other.

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