Arrange the following steps in the correct order to explain how an increase in productivity affects labor demand: A) Businesses experience higher efficiency, B) Demand for labor shifts to the right, C) Employment levels rise, D) Businesses seek to hire more workers.

When productivity increases, businesses become more efficient in their operations. This higher efficiency means they can produce more goods or services without needing to increase costs significantly. As a result, businesses will want to hire more workers, which causes the demand for labor to shift to the right. Consequently, with this increased demand for labor, employment levels rise as more workers are brought on to meet the growing production needs. For example, if a factory improves its machinery and can produce twice as many toys, it will need to hire more workers to keep up with that production, illustrating how productivity boosts labor demand.