4.1 Production and productivity

Question 1

what is production?

Answer 1

converts factor inputs such as land, labour, capital and enterprise into outputs such as goods and services

Question 2

what is the productivity gap?

Answer 2

the difference between labour productivity

Question 3

in which industries is labour productivity important?

Answer 3

manufacturing eg the car industry

Question 4

Why did the Rover Car group go bankrupt?

Answer 4

It was unable to compete with Nissan because it invested in new facilities.Labour productivity in Rover factories amounted to only 33 cars per worker per year. By contrast, Nissan produced 98 cars per worker in its then brand-new factory.

Question 5

name two reasons why the UK has low productivity?

Answer 5

1)inadequate investment into new capital goods
2)employers hoarding rather than laying off workers with zero hour contracts in a recession