5 Questions
What is labour-intensive production?
Production mainly dependent on labor with more laborers employed than other factors
What is capital-intensive production?
Production which requires a relatively high level of capital investment compared to the labor cost
What is productivity in the context of production?
$Productivity = \frac{Output}{Input}$, measuring the amount of output produced from a given amount of input over a period of time
What does capital refer to in production?
Machinery, equipment, tools, buildings, and vehicles used in production
How is production defined?
$Production$ is the transformation of raw materials to finished or semi-finished goods and services, adding value to inputs to create outputs
Study Notes
Production Concepts
- Labour-Intensive Production: A method of production that relies heavily on human labour and manual effort to produce goods and services.
- Capital-Intensive Production: A method of production that relies heavily on machines, technology, and equipment to produce goods and services.
- Productivity: The efficiency of production, measured by the output produced per unit of input (e.g. labour, capital).
- Capital: In the context of production, refers to the assets, equipment, and machinery used to produce goods and services.
- Production: The process of creating goods and services that satisfy human wants and needs, involving the transformation of inputs (e.g. labour, capital) into outputs.
Test your knowledge of factors that determine the demand for factors of production, such as labour-intensive and capital-intensive production. Explore the advantages and disadvantages of each type of production.
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