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ECONOMICS
Explain the production process in
economics

level: 1

credit: 5

planned review date: December 2006

sub-field: Economic Theory and Practice

purpose: People credited with this unit standard are able to: explain
how producers combine resources in production; how
internal and external factors influence the productivity of
firms; and describe the motives for, and consequences of,
the diversification and integration of firms.

entry information: Open.

accreditation option: Evaluation of documentation by NZQA.

moderation option: A centrally established and directed national moderation

system has been set up by NZQA.

special notes: This unit standard is based on Economics Forms 3 to 7

Syllabus for Schools (Ministry of Education, Wellington;
Learning Media, 1990).

Elements and Performance Criteria

element 1

Explain how producers combine resources in production.

performance criteria

1.1 The explanation classifies resources in terms of their type.

Range: any four of – natural, renewable, non-renewable, recycled, human,

capital, Māori taonga.

 New Zealand Qualifications Authority 2010

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1.2 The explanation identifies and outlines a resource use combination for a
production process.

Range: for resource use combination – one of – capital intensive, labour

intensive.

element 2

Explain how internal and external factors influence the productivity of firms.

performance criteria

2.1 The explanation provides evidence of the influence of internal and external
factors on productivity.

Range: internal factors – two of – specialisation, division of labour,

economies of scale, diseconomies of scale, technological
innovation;
external factors – two of – environmental, legal, trade, political,
cultural, technology.

2.2 The explanation measures productivity in terms of input or output ratios.

element 3

Describe the motives for and consequences of, the diversification and integration of firms.

Range: integration – one of – horizontal, vertical.

performance criteria

3.1 The description establishes motives for diversification and integration.

3.2 The description establishes an economic consequence consistent with the

nature of the diversification and integration.

Range: a consequence for – consumers, producers

 New Zealand Qualifications Authority 2010

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ECONOMICS
Explain the production process in
economics

Comments on this unit standard

Please contact National Qualifications Services nqs@nzqa.govt.nz if you wish to suggest

changes to the content of this unit standard.

Please Note
Providers must be accredited by the Qualifications Authority or a delegated inter-
institutional body before they can register credits from assessment against unit standards
or deliver courses of study leading to that assessment.

Industry Training Organisations must be accredited by the Qualifications Authority before

they can register credits from assessment against unit standards.

Accredited providers and Industry Training Organisations assessing against unit standards
must engage with the moderation system that applies to those standards.

Accreditation requirements and an outline of the moderation system that applies to this
standard are outlined in the Accreditation and Moderation Action Plan (AMAP). The
AMAP also includes useful information about special requirements for providers wishing to
develop education and training programmes, such as minimum qualifications for tutors and
assessors, and special resource requirements.

This unit standard is covered by AMAP 0226 which can be accessed at

http://www.nzqa.govt.nz/site/framework/search.html.

 New Zealand Qualifications Authority 2010