An electronics assembly plant currently employs 50 workers, each working 40 hours per week, to produce a total weekly output of 10,000 10,000\,10,000 components.
The plant manager is considering four independent operational strategies. Which of these strategies will achieve the highest labour productivity (measured as components produced per worker-hour)?
Extending the working week to 484848 hours for the existing 505050 workers, which increases total weekly output to 11,50011,50011,500 components.
Hiring 101010 additional part-time workers who each work 202020 hours per week, which increases total weekly output to 11,80011,80011,800 components.
Reducing the workforce to 404040 workers (each working 404040 hours) and installing automated guided vehicles, which increases total weekly output to 12,00012,00012,000 components.
Investing in a training program that increases total weekly output to 10,60010,60010,600 components with no change to the current workforce size or working hours.
156 exam-style questions on AQA A Level Economics 1.4 Production, costs and revenue, covering 1.4.1 Production and productivity, 1.4.2 Specialisation, division of labour and exchange, 1.4.3 The law of diminishing returns and returns to scale (A-level only), 1.4.4 Costs of production, 1.4.5 Economies and diseconomies of scale, 1.4.6 Marginal, average and total revenue, 1.4.7 Profit, and 1.4.8 Technological change (A-level only). Each one has a worked solution and a mark scheme showing where the marks go.