Question:
Total factor productivity (continuation of 13-37). Refer to the data for Problem 13-37. Assume the fabric costs $3.70 per yard in 2012 and $3.85 per yard in 2011.
Required
1. Compute Gerhart Company's total factor productivity (TFP) for 2012.
2. Compare TFP for 2012 with a benchmark TFP for 2011 inputs based on 2012 prices and output.
3. What additional information does TFP provide that partial productivity measures do not?