Question

Which statement is true? (LO2) a) Productivity is output per unit of input. b) Productivity is input per unit of output. c) Productivity is neither of the above.

Short answer

a) Productivity is output per unit of input.

Step-by-step solution

Statement a

Productivity is output per unit of input. This statement defines productivity as the amount of output produced per unit of input. It essentially describes the efficiency with which inputs (such as labor, raw materials, and equipment) are used to produce outputs (goods and services). In this context, a higher productivity indicates a more efficient use of inputs. So, the statement seems valid.

Statement b

Productivity is input per unit of output. This statement defines productivity as the amount of input required to produce per unit of output. It essentially describes the quantity of resources needed to produce a certain amount of goods and services. However, it doesn't provide any information about the effectiveness or efficiency of using these resources to produce outputs. This statement represents the opposite of productivity, so it is not valid.

Statement c

Productivity is neither of the above. As we have already analyzed that statement a is the correct definition of productivity, statement c is incorrect because it suggests neither statement a nor statement b are accurate definitions of productivity. Therefore, the correct statement is:

Answer

a) Productivity is output per unit of input.