NCERT Class 9 Economics Chapter 1 MCQs Questions with Answers

The ratio of Standouts (and their contribution) to Stragglers (and their drag) was the clearest factor in driving fast productivity growth. In almost all subsectors experiencing rapid productivity growth (defined as 2 percent per year or more), Standouts drove the bulk of that growth, and there was less drag from Stragglers (Exhibit 3). Each factor of production is important to produce the best output.

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Being large helps, but size alone is not sufficient to be a Standout. Large firms did not make an outsize contribution for their employment share. For example, in the United States, the top 10 percent of firms by size that made positive contributions had 54 percent of the employment share but accounted for only 68 percent of positive productivity growth.

Meanwhile, US Standouts had a 23 percent share of employment but accounted for 78 percent of positive growth. In fact, large firms are as likely to be Stragglers as Standouts, which explains this pattern. We look at a sample of about 8,300 large firms (all with more than 50 employees, and most with more than 500) that cover the two-thirds of value added generated by large firms in our focus sectors. We include the international operations of these firms with the aim of providing an accurate analysis of this lab economy rather than twisting ourselves into knots reconciling data with national statistics.

Overall, retail in the United States was led by a vibrant frontier of e-commerce and traditional retailers. Analyzing productivity as firm-level real GVA per worker rather than profitability or efficiency. In line with economic convention, this research divides GVA by the number of employees to compute productivity and adjusts for changes in input and output quality and prices at the sector level. For US firms whose disclosure requirements are lower, we estimate employee costs by taking sector-level average wages. We make manual adjustments using firm financial statements for the most relevant firms.

We have Provided The Story of Village Palampur Class 9 Economics MCQs Questions with Answers to help students understand the concept very well.

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• To give a sense of how important a single firm can be, just another dozen or so of the largest Standouts could have doubled productivity growth in their entire country.
• In the United States, 5 firms (Standouts) accounted for 78 percent of positive growth, while two firms (Stragglers) accounted for 57 percent of negative growth.
• Looking at all firms, about 50 percent increased productivity faster than the sector average.
• Therefore, it is very important that we take good care of land and other natural resources used in farming.
• Check the below NCERT MCQ Questions for Class 9 Economics Chapter 1 The Story of Village Palampur with Answers Pdf free download.
• This definition of productivity is different from the one commonly used by business executives as shorthand for efficiency or profitability.

Capital and labour are still the two most important inputs for processes and profits today. Certain indexes, such as the ISM manufacturing index, can be used to track production, such as manufacturing. An increase in production will ultimately lead to economic growth. GDP can be merely defined as a measure for representing the overall production of all services and goods in an economy.

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Firms themselves benefit from productivity growth, or growth in value added per worker. In view of long-term demographic shifts and the tight labor markets of today, labor productivity is a strategic imperative.2“Dependency and depopulation? Confronting the consequences of a new demographic reality,” McKinsey Global Institute, January 2025. And productivity growth is the only way for businesses to serve all their stakeholders, delivering rising wages for their workers, increased customer surplus, and profit.

If any of the factor is missing, it directly impacts the output. For example, increase in capital requires more entrepreneurship, which necessitates more land and labor for production. The second part of the table shows subsectors with low productivity growth. It includes grocers and apparel firms for the three countries, among other subsectors. Productivity Stragglers are firms that made negative contributions of at least one basis point to the productivity growth of their respective national samples in 2011–19.

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Moreover, since total wages are often twice as large as profits, they weigh more heavily in this formulation, too. A series of stacked bar charts displays the contribution of firms to productivity growth in the United States, Germany, and the United Kingdom. The charts show that a small number of firms—the Standouts and Stragglers—accounted for a disproportionate share of productivity growth and degrowth.

In the United States, 5 firms (Standouts) accounted for 78 percent of positive growth, while two firms (Stragglers) accounted for 57 percent of negative growth. In Germany, a very small number of Standouts contributed 65 percent of the positive growth and Stragglers contributed 66 percent of the negative growth. Finally, in the United Kingdom, the very few Standouts accounted for 45 percent of positive growth, while Stragglers accounted for 48 percent of negative growth. The exhibit highlights that a small percentage of firms had a significant impact on overall productivity growth. The chart also shows Standouts and Stragglers made a significantly larger contribution to employment than other firms in the sample. This is a reasonably stable period—albeit one with low productivity growth—between the global financial crisis and the COVID-19 pandemic.

The patterns observed in this period may hold outside of it, although the cast of characters will change. Firms that performed well on productivity during this period may have experienced different outcomes later, and vice versa. A step chart displays the contribution of firms to the US sample’s productivity growth from 2011–19. The chart shows that 44 Standout firms (5 percent of the sample) account for nearly 80 percent of the positive productivity growth, while 507 firms (55 percent) account for the rest of the positive growth. Fourteen Straggler firms accounted for 57 percent of negative growth, with 349 firms contributing the rest.

There are four factors of production, namely, Land, Labour, Capital, and Entrepreneurship. While the land is an important component of most businesses, its value can fluctuate depending on the industry. A technology company, for example, can easily start operations with no upfront land investment. Land, on the other hand, is the most important component of any real estate venture. Farmers increase the value and utility of land by cultivating crops on it. The land was responsible for generating economic value for a group of early French economists known as “the physiocrats,” who predated the classical political economists.

Finally, it emphasizes reallocation of resources to leading businesses as much as internal improvements. Each shift is accompanied by a corresponding overarching question probing the conditions necessary for success in each area. The third and last part of the exhibit part shows retail firm productivity in the United Kingdom from 2011–19, based on a sector sample of about 1,700 firms.

• In comparison, productivity growth in the German electronic equipment and semiconductors subsectors was limited.
• Large firms did not make an outsize contribution for their employment share.
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In 2011, the sector’s average productivity per employee was £34,000, and in 2019 it was £32,000. Overall, retail in the United Kingdom experienced traditional grocers and retailers contributing from outside the frontier. The core subject on which the article has been written is related to business economics. The main topic that has been discussed is the factors of production in economics.

The overall country sample productivity growth was +2.1 percentage points. The relationship between Standouts and sector growth is, of course, a symbiotic one. Standouts drive the growth of sectors, but some sectors also have the market dynamics, technology, regulation, and competitive setting that provide fertile ground for Standouts. There were more Standouts in sectors where firms could create new customer value and scale new business models than in sectors that were mostly about efficiency.

Customers and employees are typically the biggest and most immediate beneficiaries of productivity growth. Among the three factors of production,we found that labour is the mostabundant factor of production. There aremany people who are willing to work asfarm labourers in the villages, whereasthe opportunities of work are limited. They come from all sectors and all parts of the productivity curve, have vastly different the most abundant factor of production is starting points on common business metrics and past performance, and contribute to productivity growth in different ways. What they have in common is “doing things differently” more than “doing things more efficiently.”15Inflation follows a similar pattern of idiosyncratic bursts rather than being driven by macroeconomic shocks. See, for instance, Santiago Alvarez-Blaser et al., The granular origins of inflation, BIS working paper number 1240, January 2025.