Productivity
Definition
Productivity measures the efficiency of a production process, typically quantified as the amount of output produced per unit of input used within a specific period. It is crucial for assessing the performance and competitiveness of businesses and economies.
Analogy
Imagine productivity as the fuel efficiency of a car—just as a car that can travel more miles on less gasoline is considered more efficient, a business that can produce more goods or services with fewer resources (like time, labor, or materials) is seen as more productive.
Related terms
Efficiency: The ability to accomplish a task or produce an output with a minimum amount of waste, time, or effort.
Output: The quantity of goods or services produced in a given time period by a company, industry, or economic system.
Input: The resources (such as labor, materials, and capital) used in the production process to create goods or services
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