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In: Economics

In a problem you're computing labor productivity (also known as worker productivity) for Germany. in U.S....

In a problem you're computing labor productivity (also known as worker productivity) for Germany. in U.S. dollars. They are very prosperous, like the U.S. The number you come up with is $900,000. Is this a reasonable value?

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Expert Solution

No, this is not a reasonable value.

Labor productivity is total volume of output divided by total inputs. For example if a company produces goods worth $80000 (output) using 1500 hours of labor (input), the labor productivity is $53 per hour of work.

So, $900000 is a very high value of labor productivity that does not seem to be reasonable because no employee can have such a high volume of productivity no matter how developed the economy is.

Rahul Sunny answered 2 years ago
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