Vocab
What is productivity?
The output per unit of input. In economics, productivity measures the efficiency with which we produce goods and services.
As of 2025, the United States has the highest GDP rate in the world with a whopping $27.72 trillion dollars. The other two top countries are...
China ($17.79 trillion) and Germany ($4.52 trillion)
According to the National Institute of Standards and Technology, there are three primary aspects of examining U.S. manufacturing statistics on competitiveness. What are they?
(1) how the U.S. industry compares to other countries, (2) the trends in the domestic industry, and (3) the industry trends compared to those in other countries
Perfect competition
when there are multiple sellers with no monopolies, but a lot of competition between the companies
U.S. productivity has been increasing because of...
The quality of the labor force, Increasing capital investment per worker, Infrastructure, and innovations
What are the three main factors when measuring productivity?
1. The units of output for every unit of input.
2. The amount of capital used to produce a firm’s product, or farm acreage per unit of output.
3. Labor productivity which is expressed as the output per worker per hour.
A monopolistic market is a...
There is no competition
When sales slump, manufacturers can reduce production by...
Laying off workers and maintaining prices.
The two main characteristics for monopolistic competition are...
Product differentiation. - Many sellers who produce similar products that the buyer believes differ in some qualities.
Market Power
Refers to the power of buyers and sellers to influence prices
Labor productivity increases when...
Workers have more capital (plant, equipment, etc.) to work with.
What is Mr. Shaw's favorite Dunkin drink?
The Caramel Craze Signature Latte with 7 pumps of caramel sauce.
Product Differentiation
Gives suppliers the power to influence prices
What are the main reasons for the recent spike in America's productivity?
1. The quality of the labor force.
2. Increasing capital investment per worker.
3. Infrastructure.
4. Innovations.
What is Mr. Shaw's favorite Starbucks drink?
Venti Pistachio Latte with 7 pumps of pistachio sauce