production levels
TRANSCRIPT
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Prepared by Sandrea Butcher
LEVELS OF PRO-DUCTION
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The level of production depends on the following:
Output
Capi-tal
LandLabou
r
Availability of resources
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Level of technology
Cultural patterns
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Political and economic policies of the coun-try
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There are four production levels
Subsistence
• This is production to meet basic needs.• It happens on a small scale and satisfies in-
dividual/community needs, but not country wide needs.
• There is very little to no surplus
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Domestic
• This is country-wide production.• Goods and services produced locally are con-
sumed locally.• It denotes self sufficiency and reduces the
need for imports.
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Surplus
• This occurs when domestic production exceeds domestic consumption (excess supply).
• It is important to note that domestic needs and wants are satisfied first, then the surplus can be used to satisfy foreign needs.
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Export
• Some countries produce goods for the export market
• This may occur because:• there is no demand for the good locally• The country has a quota to meet with
an overseas market
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• In some countries governments set up Export Pro-cessing Zones (EPZs)
• Businesses receive incentives such as tax exemp-tions
• In the Caribbean region activities in EPZs include textiles and data entry.
Montego Bay Free Zone
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• According to Index Mundi, Barbados exports Aircraft parts