4.2 Specialisation, division of labour and exchange Flashcards
1
Q
specialisation
A
where an individual worker, firm, reigon or country produces a limited range of goods or services
2
Q
examples of specialisation:
A
- indivudual worker specialising as tax accountant.
- indiv. firm specialising in accountancy
- indiv. region specialising in investment banking.
- indiv. country specialising in provision of financial services.
3
Q
division of labour
A
specialisation at the level of an individual worker
4
Q
exchange
A
where one this is traded for something else
5
Q
importance of exchange
A
specialisation and division of labour are only viable system due to this
6
Q
barter
A
- a system exchange as relied on
- involves exchange of goods and services for other goods and services
7
Q
benefits of specialisation and division of labour
A
- repition of limited range of skills = increase skill and aptitude, leading to worker becoming expert
- reduced time spent moving betwee diff tasks = increased productivity
- tasks broken into smaller ones = efficient to us specialist machinery
- division of labour allows people to work to their natural strengths
8
Q
In SR
A
= period of time where at least one factor of production is fixed in terms of no. of units a firm can use.
= firms will have some fixed costs of production which must pay even is don’t produce output
9
Q
In LR
A
= period of time over which all factors of production can be varied
= may increase or reduce scale of output
10
Q
A
