1.1.5 Specialisation and division of labour

Question 1

How do workers, firms and regions specialise?

Answer 1

When a worker or firm only does one or a range of narrow tasks, therefore they get skilled at that certain thing.

Question 2

Advantages and disadvantages of specialisation and division of labour in organising product?

Answer 2

+ Increased output, less waste and lower unit costs.
- Increased boredom of workers, finite resources and changes in tastes and fashion.

Question 3

Advantages and disadvantages of specialising in the production of goods and services to trade?

Answer 3

+ Allows for workers to becomes more skilled in a particular task, therefore efficiency increases and waste is reduced.
- World prices may fall which reduces revenue on a product

Question 4

What are the 4 functions of money?

Answer 4

1. Medium of exchange
2. Unit of account
3. Store of value
4. Standard of defined payment

Question 5

Why a mean of exchange is necessary for the full benefits of specialisation to be realised.

Answer 5

Provides a mean by which revenue can be used efficiently.