1.1.5 - Specialisation & The Division Of Labour Flashcards
What Is Specialisation?
Is the concentration of production on a limited range of goods and services.
What Is The Division Of Labour?
Is when labour becomes specialised in a particular part of the production process.
What Does Specialisation & The Division Of Labour Allow Workers To Do?
(2 Points)
~ Allows workers to specialise by focusing on one of the components that make up the production process and thereby gain a significant skill in doing it.
~ Results in higher output per worker and increases productivity.
Who Created The Concept Of Specialisation & The Division Of Labour?
Adam Smith.
What Was Adam Smiths Statement About Specialisation & The Division Of Labour?
He stated that the concept showed how it could increase labour productivity, allowing firms to increase efficiency and lower their cost of production.
How Did Adam Smith Develop The Ideas For Specialisation & The Division Of Labour?
Based on the observations he made during a visit to a pin factory.
What Are The Advantages Of Specialisation & The Division Of Labour In Organising Production?
(4 Points)
~ Creates low skilled jobs.
~ Lower cost for firms.
~ Training is cheap.
~ Lower prices
What Are The Disadvantages Of Specialisation & The Division Of Labour In Organising Production?
(4 Points)
~ Demotivation.
~ Higher structural unemployment.
~ Less productivity.
~ Increased worker turnover rates.
What Are The Advantages Of Specialisation & The Division Of Labour To Trade?
(4 Points)
~ Lower unit costs.
~ Higher income.
~ Higher labour productivity.
~ Increases the variety of goods.
What Are The Disadvantages Of Specialisation & The Division Of Labour To Trade?
(4 Points)
~ Structural unemployment.
~ Higher interdependence.
~ Wages can fall.
~ Leads to resource depletion.
What Was Bartering?
When you swap one good for another.
What Are The 4 Key Functions Of Money?
~ Medium of exchange.
~ Measure of value.
~ Store of value.
~ Method of deferred payment.
