2.4.1 PRODUCTIVITY AND EFFICIENCY

Question 1

what is productivity

Answer 1

measures the efficiency of production

Question 2

whats labour productivity

Answer 2

the amount a worker produces over a specific period of time

Question 3

formula for labour productivity

Answer 3

output (per time period) / number of employees (per time period)

Question 4

formula for capital productivity

Answer 4

output / capital employed

Question 5

whats capital intensive

Answer 5

when products are mainly produced by machines and robots , meaning the initial outlay and maintenance will be very high

Question 6

whats labour intensive

Answer 6

is when products are mainly produced by human workers (machines mat be used too) but overall it requires human creativity and effort to produce the product

Question 7

advantages of capital intensive

Answer 7

• often leads to greater efficiency and productivity
• can produce goods with consistent quality, reducing variability
• while initial investments are high, capital operations can lead to lower variable costs over time
• can drive innovation and improvements in production process

Question 8

disadvantages of capital intensive

Answer 8

• upfront costs for machinery can be substantial
• may be less adaptable to changes in consumer demand or market change
• increased automation can lead to job losses
• machinery requires ongoing maintenance and repairs which can add to operational costs