Labour Productivity, Calculating Costs and Capacity Utilisation

Green highlighted text is an formula.

Labour Productivity

Measures how many units one employee makes

Labour Productivity = Total Output/Number of Employees

Calculating Unit Cost

Measures the cost per unit.

Unit costs = Total costs/Total output

Calculating Costs

Total fixed costs = Total costs – Total variable costs

Total variable costs = Total costs – Total fixed costs

Total Costs = Total variable costs + Total fixed costs

Total Cost = Unit costs x no of unit costs

Unit cost = Total costs/number of units

No of units = Total costs/unit costs.

Capacity Utilisation

Capacity utilisation shows what percentage of the maximum possible output is being utilised (existing output).

Capacity Utilisation = Existing Output/Maximum Possible Output