Chapter 2- Increasing Productivity and Quality Terms: Productivity: a measure of efficiency that compares how much is produced with the resources used to produce it. Quality: a products fitness for use in terms of offering the features that consumers want. Responding to the Productivity Challenge: - Measuring Productivity: Labour productivity: partial productivity ratio calculated by dividing gross domestic product by total number of workers. - Productivity among Global Competitors: Domestic Productivity: A country that improves its ability to make something out of its existing resources can increase the wealth of all its inhabitants. Conversely a decline in productivity shrinks a nations total health. When that happens, an increase in one persons wealth comes only at the expense of others with whom he or she shares an economic system. Manufacturing versus Service Productivity: manufacturing productivity is higher than service productivity. Industry Productivity: In addition to differences between the manufacturing and service sectors, industries within these sectors differ vastly in terms of productivity. Agriculture is more productive in Canada than in many other nations because we use more sophisticated technology and superior natural resources. Company productivity: high productivity gives a company a competitive edge because its costs are lower.