1303AFE Lecture Notes - Lecture 10: Opportunity Cost, Comparative Advantage, Production Function
30 May 2018
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Week 10 Economics for decision making lecture notes
Productivity and economic growth
Production and growth
• A outrys stadard of liig depeds o its aility to produe goods ad series
• Within a country there are large changes in the standard of living over time
Economic growth around the world
• Living standards, as measure by real GDP per person, vary significantly among
nations
• The most developed countries have real GDP per person that is ten to twenty times
that of the poorest countries
find more resources at oneclass.com
find more resources at oneclass.com
Productivity: its role and determinants
• Productivity is the key determinants of living standards
• Productivity refers to the quantity of goods and services that a worker can produce
from each hour of work
• The inputs used to produce goods and services are called the factors of production
The factors of production
• Physical capital
• Human capital
• Natural resources
• Technological knowledge
• Capital is a produced factor of production
o It is an input into the production process that in the past was an output from
the production process
Physical capital
• Physical capital is the stock of equipment and structures that are used to produce
goods and services
o Tools used to build or repair automobiles
o Tools used to build homes or buildings
o Office buildings, schools, etc.
Human Capital
• Human capital is the ecooists ters for the koledge ad skills that orkers
acquire through education, training, and experiences.
o Like physial apital, hua apital raises a atios aility to produe goods
and services
o Government should provide good schools, colleges and universities, since this
improve the quality of the labour force
find more resources at oneclass.com
find more resources at oneclass.com
Document Summary
Week 10 economics for decision making lecture notes. Production and growth: a (cid:272)ou(cid:374)try(cid:859)s sta(cid:374)dard of li(cid:448)i(cid:374)g depe(cid:374)ds o(cid:374) its a(cid:271)ility to produ(cid:272)e goods a(cid:374)d ser(cid:448)i(cid:272)es, within a country there are large changes in the standard of living over time. Economic growth around the world: living standards, as measure by real gdp per person, vary significantly among nations, the most developed countries have real gdp per person that is ten to twenty times that of the poorest countries. The factors of production: physical capital, human capital, natural resources, technological knowledge, capital is a produced factor of production. It is an input into the production process that in the past was an output from the production process. Physical capital: physical capital is the stock of equipment and structures that are used to produce goods and services, tools used to build or repair automobiles, tools used to build homes or buildings, office buildings, schools, etc.
