Thursday, November 03, 2005

Productivity and Standard Living


Productivity is defined as how much output we can get from each unit of input or as the BLS puts it:

Productivity
A measure of economic efficiency that shows how effectively economic inputs
are converted into output. Productivity is measured by comparing the amount of
goods and services produced with the inputs that were used in
production.


A question that should be posed to the students is the following:
If Productivity is increasing thereby you get more per unit of input are you better off or worst off?

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