Define Productive Efficiency.Does Productive Efficiency Imply Allocative Efficiency? Explain

question 228

Essay

Define productive efficiency.Does productive efficiency imply allocative efficiency? Explain.

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Definitions:

Quantity Standard

A benchmark or norm for the amount of materials, labor, and overhead required to produce a unit of output in a given period.

Performance Level

A measurement of the efficiency and effectiveness of a process or activity.

Labour Rate Variance

The difference between the actual cost of direct labor and the expected (or standard) cost, often used to assess workforce efficiency or cost control.

Labour Efficiency Variance

The difference between the actual hours worked and the standard hours expected to complete a task, multiplied by the standard labor rate.