Productivity Flashcards
1
Q
what is productivity?
A
- a measurement of the efficiency with which a business turns production inputs into output
2
Q
whats the equation for labour productivity?
A
output/no of employees
3
Q
whats the equation for capital productivity?
A
output/capital employed
4
Q
what are the 4 ways to improve productivity?
A
- technology
- lean production
- training
- workplace recognition
5
Q
what are 4 advantages of high productivity?
A
- increased economies of scale
- increased competitiveness
- lower unit costs
- spreading of fixed costs over higher output
6
Q
what is capacity utilisation?
A
- all employed factors of production are being used to their optimum level of efficiency
- producing the maximum level of output, given the business’s current investment levels
7
Q
what is the equation for capacity utilisation?
A
actual output/max output * 100
8
Q
what are 4 problems with working at full capacity?
A
- lack of flexibility
- pressure on staff
- more machine failures
- fall in quality
9
Q
what are 4 problems with spare capacity?
A
- demotivation
- increased costs
- reduced profits
- lack of return on investment capital
