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Calculating the productivity measures

A farmer grows two crops: lettuce and beans. The farmer uses three inputs: labor, seed and fertilizer. The past prices and the quantities of each are given in the following tables:

Physical Quantities
Past Last This
Inputs/outputs: Prices Year Year
Outputs:
Lettuce $1500/ton 500 tons 600 tons
Beans $1300/ton 200 tons 100 tons

Inputs:
Labor $10/hour 1000 hrs 1200 hrs
Seeds $12/pound 300lbs 320 lbs
Fertilizer $500/ton 10 tons 12 tons

Required:

a) Calculate productivity measures for last year and this year using past prices.

b) Calculate the percentage change in productivity.

Solution Preview

a) Calculate productivity measures for last year and this year using past prices.

Productivity last year=Total output value last year/Total input ...

Solution Summary

Solution provides the step by step method to calculate the productivity measures.

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