2.6 production Flashcards

1
Q

what is the role of producers

A

makes and supplies goods and services by combining the factor of production

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2
Q

what is production

A

the total amount of goods and services produced by a firm or industry in a given amount of time

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3
Q

what is productivity

A

a measure of efficiency measured in terms of output per unit of input

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4
Q

what is the equation for productivity

A

total output / total input

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5
Q

what does productivity rely on

A

investment in the production process

workforce education and training

better quality raw materials

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6
Q

what is a diseconomy of scale

A

cost of production increasing as the firm grows in size due to disadvantages of growing

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7
Q

how can producers increase productivity

A

workers specialising in part of the production process

investment in new tech

improving skills in workforce

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8
Q

why is high productivity important

A

lower average cost and increasing economies of scale

greater profits

increased total output

greater export thus more economic growth

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9
Q

what is total cost and the equation

A

the cost of actually producing an item

total cost = total fixed cost + total variable costs

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10
Q

what is average cost and the equation

A

the cost of producing a single unit

total fixed cost / quantity

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11
Q

what is total revenue and the equation

A

total income from sale

price x quantity

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12
Q

what is an economy of scale

A

occur when mass producing a good results in lower average cost.

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13
Q

what are external economies of scale

A

improvement in transport links

location

concentration of firms (suppliers)

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14
Q

what are internal economies of scale

A

division of labour

financial economies

marketing economies

risk-bearing economies

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