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In microeconomic theory, productive efficiency (or production efficiency) is a situation in which the economy or an economic system (e.g., bank, hospital, industry, country) operating within the constraints of current industrial technology cannot increase production of one good without sacrificing production of another good. [1]
Production–possibility frontier. In microeconomics, a production–possibility frontier (PPF), production possibility curve (PPC), or production possibility boundary (PPB) is a graphical representation showing all the possible options of output for two goods that can be produced using all factors of production, where the given resources are ...
Graph of total, average, and marginal product. In economics, a production function gives the technological relation between quantities of physical inputs and quantities of output of goods. The production function is one of the key concepts of mainstream neoclassical theories, used to define marginal product and to distinguish allocative ...
Economic efficiency. In microeconomics, economic efficiency, depending on the context, is usually one of the following two related concepts: [ 1 ] Allocative or Pareto efficiency: any changes made to assist one person would harm another. Productive efficiency: no additional output of one good can be obtained without decreasing the output of ...
An enhancement of "just-in-time" is the so-called "just in sequence" (JIS). Based on the JIT principle, the products are also delivered to the customer in the correct sequence. JIT is now standard throughout the automotive industry. It is used, for example, for interior parts (seats, airbags, steering wheels, dashboards) or painted parts.
v. t. e. In economics, specifically general equilibrium theory, a perfect market, also known as an atomistic market, is defined by several idealizing conditions, collectively called perfect competition, or atomistic competition. In theoretical models where conditions of perfect competition hold, it has been demonstrated that a market will reach ...
Allocative efficiency. Allocative efficiency is a state of the economy in which production is aligned with the preferences of consumers and producers; in particular, the set of outputs is chosen so as to maximize the social welfare of society. [1] This is achieved if every produced good or service has a marginal benefit equal to the marginal ...
Total factor productivity is a measure of productive efficiency in that it measures how much output can be produced from a certain amount of inputs. It accounts for part of the differences in cross-country per-capita income. [2] For relatively small percentage changes, the rate of TFP growth can be estimated by subtracting growth rates of labor ...