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How do you calculate the average product of labor?
total output per period divided by time period
List ways of increasing labor productivity.
Provide training and education to workers to expand on skills, offer strong incentives to work, use more advanced machinery
List some factors affecting labor productivity?
consumer demand for products, factor costs, factor availability
How exactly does the consumer demand affect labor productivity?
The more goods and services consumer want and are willing to buy, the more production is required for firms, when it falls under the case of a derived demand. In a factor demand, when the willingness of producers to increase factors of production happens, more production also becomes necessary.
How exactly does factor price affect labor productivity?
The demand for a good and service depends on its market price. For instance, for a factor of production, the higher their price the more costly it gets for production. As wages increase, the quanity demanded for labor would also drop.
How exactly does factor availability affect labor productivity?
The production of a good or service depends on the availability of supply. For instance, when the supply of skilled labor is low, it can disrupt production.
Define division of labor.
It is when a production process is separated into different sets of tasks, with each task performed by different people.
What are some advantages to division of labor?
It can make full use of one’s ability, save time, and allow the use of machinery
What are some disadvantages to division of labor?
Work may become boring for workers, or lose job satisfaction, there may be over-interdependence or a standardization of products.
What is the difference between labor-intensive and capital-intensive productions?
Capital-intensive productions require more capital than labor inputs where the process of production is often automated and quick. Labor-intensive productions meanwhile, occur in service industries where machinery use is unfeasible.
What are some advantages to capital-intensive production?
less human errors, longer working hours, no strikes or trade union issues
What are some advantages to labor-intensive production?
better quality esp. for tailored products, more flexible as they can hire workers depending on output
List two examples of economies of scale.
managerial and purchasing
List two examples of diseconomies of scale.
Marketing and agglomeration
