7. Producrion And Efficiency.

Question 1

Division of labour.

Answer 1

Breaking the production process into a sequence of tasks, with workers assigned to particular tasks.

Question 2

Production.

Answer 2

The process that converts factor inputs into outputs of goods and services.

Question 3

Economies of scale.

Answer 3

Where an increase in the scale of production leads to a reduction in average total costs for firms.

Question 4

Diseconomies of scale.

Answer 4

Where an increase in the scale of production leads to increases in average total costs for firms.

Question 5

Competition.

Answer 5

A market situation in which there are a large number of buyers and sellers.

Question 6

Monopoly.

Answer 6

A market structure dominated by a single seller of a good.

Question 7

Specialisation

Answer 7

A production of limited range of goods by an individual factor of production or firm or country.

Question 8

Fixed costs

Answer 8

Costs which do not vary as output changes

Question 9

Variable costs

Answer 9

Costs which vary with level of output