Average productivity

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Updated: Aug 20, 2021

Output of a good divided by the number of units of the particular factor of production required to proquce it. The most usual measure is the average productivity of labour found by dividing output by numbers employed or man-hours. Measures of average productivity are used as indicators of productive efficiency. They suffer from the limitation that inter-firm productivity comparisons may be misleading if the firms have different labour and capital intensities

Reference: The Penguin Business Dictionary, 3rd edt.



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