Chapter 5 Flashcards
What is specialisation?
Production of a limited range of goods by an individual, firm or country.
In what ways does specialisation occur?
Globally- trade between specialised goods between countries
Regionally- Parts of the country trade specialised goods
Individually -
What is division of labour?
Specialisation done by individuals.
What is the effect of division of labour?
Increase in productivity
Increase in people with specialised skills
Saved costs as less tools bought
Workers do roles that suite them
Time saved
What are the types of productivity?
Labour productivity- output per worker
Capital productivity- output per capital.
What are the disadvantages of specialisation?
Work becomes boring and monotonous
Market my demand diversity in goods and services
May become dependant on your specialised skill
May be disruptions in the chain, causing skill to be valueless
What are the functions of money?
A medium of exchange
A measure of value
A method of deferred payment
A store of value
What are the forms of money?
Cash
Money in current accounts
Near monies
What are near monies?
A measure and store of value but can not be exchanged.
It is very quick and cheap to ex
