LEVELS OF PRODUCTION

Levels of production refer to the amount of goods that are produced. 

1.subsistence

2.domestic

3.surplus/ export

•This is the lowest level of production.

• Subsistence productions refer to output from the production process that is just enough for the survival.

•This level of production is geared towards satisfying basic needs.

•Domestic production refers to production that is more than survival level. 

•Production is adequate to supply enough goods and services to meet the needs of its citizens.

•Excess is not available for export.

•At the surplus level the country produces more than enough goods and services to meet its domestic needs and the extra is exported to other countries.

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•This surplus, when sold, earns the country valuable foreign exchange which can be used to purchase goods and services to improve the country.