Question

How do firms examine productivity?

Answer 1

Firms examine productivity through methods like measuring the amount produced per hour of work, known as labor productivity, and looking at total factor productivity. They can also compare their productivity levels with industry benchmarks or competitors.

Step-by-step explanation:

Firms examine productivity through various methods. One common way is to measure the amount produced per hour of work, which is known as labor productivity. This can be calculated by dividing the total output by the total number of labor hours. Another way to measure productivity is by looking at total factor productivity, which takes into account all inputs used in the production process, such as labor, capital, and technology. Firms can also compare their productivity levels with industry benchmarks or competitors to assess their performance.

Answer 2

Productivity is the average measure of the productivity of the firms. It is usually measured in output to input. When all the outputs and inputs are involved in the production process, it is now called the total productivity.