When a producer produces goods with the best technology and with efficient labor, this type of production will increase the production level of the economy and, thus the national income will increase and help to grow the economy. A good producer will always evaluate what type of products and the best labor/production for their needs.
They do this by comparing the relative prices of goods and services in the market. They will use the results to determine the potential profitability of each combination. When finished, it should be clear to the producer which types of labor should be used and which inputs, in order to ensure the best profits. Thus, after evaluating the cost of the inputs, and the types of the goods that one should produce, the productivity of the economy will increase and will leads to the development of the economy.
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