Lesson 4.1.4.1

4.1.4.1 Production and productivity Quiz: AQA Economics, Unit 1

20 questions

Written by Revision Ninja · Last reviewed 11 October 2026

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Lesson 4.1.4.1, Production and productivity: 20 multiple choice questions for the AQA Economics (7136), Unit 1: Individuals, firms, markets and market failure, written with Revision Ninja.

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The 20 questions

  1. Production is best defined as:

    • the process of converting inputs, such as labour and capital, into outputs of goods and services.
    • the process of distributing goods to consumers.
    • the process of consuming goods to satisfy needs and wants.
    • the process of buying factors of production in a market.

  2. Labour productivity is most accurately measured as:

    • total output divided by the number of workers employed.
    • total revenue divided by total costs.
    • the wage rate multiplied by the number of workers.
    • the number of workers divided by total output.

  3. A firm produces 600 units with 20 workers. What is labour productivity?

    • 12 units per worker.
    • 600 units per worker.
    • 30 units per worker.
    • 580 units per worker.

  4. A firm increases its output from 600 to 690 units while keeping workers at 20. What is the change in labour productivity?

    • Rises from 30 to 34.5 units per worker.
    • Falls from 30 to 28 units per worker.
    • Unchanged at 30 units per worker.
    • Rises from 30 to 690 units per worker.

  5. Which of the following would be most likely to increase labour productivity in a manufacturing firm?

    • Training workers and introducing more efficient equipment.
    • Reducing the skills of the workforce to cut wages.
    • A fall in the number of machines used.
    • A reduction in capital investment in machinery.

  6. Why is productivity important for a firm's costs of production?

    • Higher productivity always raises the wage rate paid to workers.
    • Higher productivity has no effect on costs of production.
    • Higher productivity means each unit of output requires fewer resources, so unit costs can fall.
    • Higher productivity means more labour is needed for each unit of output.

  7. Which statement best explains the difference between capital and labour as inputs into production?

    • Capital is land, and labour is enterprise.
    • Labour and capital are identical inputs.
    • Capital is human effort, while labour is produced goods such as machines.
    • Labour is human effort, while capital is produced goods used to make other goods.

  8. Which of the following best describes how a firm converts inputs into output?

    • Inputs are only converted through government spending.
    • Outputs are converted into inputs by the marketing department.
    • Factors of production are combined through the production process to create goods and services.
    • Inputs are consumed by households and converted into final goods.

  9. Which of the following best explains why average productivity can rise even when some workers have low output?

    • Because average productivity is total output divided by workers, so high output by others can raise the average.
    • Because average productivity always equals the lowest individual output.
    • Because average productivity is unaffected by total output.
    • Because low output workers are excluded from the calculation.

  10. A country's total output rises by 5% while its labour force rises by 8%. What happens to labour productivity?

    • It rises by 13%.
    • It is unchanged at 5%.
    • It falls by about 2.8%.
    • It rises by 3%.

  11. Which statement is a valid evaluation of labour productivity as a measure of economic performance?

    • It shows exactly how much profit a firm will make.
    • It is irrelevant because output does not depend on workers.
    • It measures all aspects of economic welfare, including environmental quality.
    • It is useful for comparing efficiency, but it ignores capital inputs, quality of goods and distribution of income.

  12. Which of the following is the best example of how technology can raise productivity?

    • Reducing the amount of machinery used in production.
    • Increasing the number of workers without changing machines.
    • Halting production during peak demand periods.
    • Introducing automated assembly lines that increase output per worker.

  13. A bakery produces 240 loaves per day with 8 bakers and then 300 loaves per day with 10 bakers. What happens to labour productivity?

    • It rises from 30 to 40 loaves per baker.
    • It falls from 30 to 24 loaves per baker.
    • It rises from 24 to 30 loaves per baker.
    • It is unchanged at 30 loaves per baker.

  14. Which of the following is a reason why productivity differences exist between countries?

    • Differences in the age of the population only.
    • Differences in the number of hours of sunlight each day.
    • Differences in the name of the currency used.
    • Differences in the quality of capital, skills and technology used.

  15. Which of the following statements is correct about the effect of falling productivity on a firm?

    • Falling productivity increases output per worker.
    • Falling productivity lowers unit costs and increases competitiveness.
    • Falling productivity raises unit costs, which can reduce competitiveness.
    • Falling productivity has no impact on costs.

  16. Which of the following is most closely associated with the term 'capital deepening' in the production process?

    • A reduction in the skills of workers.
    • A rise in the amount of capital per worker, which tends to raise labour productivity.
    • A fall in the number of machines used by firms.
    • An increase in the price of machinery.

  17. A firm is considering whether to invest £1 million in new equipment that raises productivity. What is the most appropriate evaluation?

    • The investment only affects the number of workers hired.
    • The investment may raise productivity, but the benefit depends on the cost of the equipment, its effect on output and the wage rate.
    • The investment is always profitable, because productivity always rises.
    • The investment is never worthwhile, because capital reduces output.

  18. Which of the following best describes why total output and labour productivity can move in different directions?

    • Because total output is unrelated to the number of workers.
    • Because labour productivity is always equal to total output.
    • Because total output can rise if workers rise faster than productivity falls, so output and productivity may diverge.
    • Because labour productivity is total output multiplied by workers.

  19. Which of the following correctly summarises the relationship between productivity and wages in the long run?

    • Wages are determined only by government decree, not by output.
    • Productivity has no connection to wages.
    • Higher productivity always reduces wages for all workers.
    • Higher productivity tends to support higher real wages over time, because workers produce more value per hour.

  20. A firm has output of 1,500 units from 50 workers and raises output to 1,800 units with 60 workers. Which statement is correct?

    • Productivity is unchanged at 30 per worker, and output rises by 30%.
    • Productivity is unchanged at 30 per worker, and output rises by 20%.
    • Productivity rises from 30 to 33 per worker, and output rises by 20%.
    • Productivity falls from 30 to 28 per worker, and output rises by 20%.

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