Chapter 7: Production and efficiency Flashcards
Division of labour
Breaking the production process down into a sequence of tasks, with workers assigned to particular tasks.
Specialisation
The production of a limited range of goods by an individual factor of production or firm or country.
Production
The process that coverts factor inputs into output of goods and services.
Fixed costs
Costs of production that do not vary as output changes.
Variable costs
Costs of production that cary with output.
Economies of scale
Where an increase in the scale of production leads to reductions in average total costs of firms.
diseconomies of scale
Where an increase in the scale of production leads to increased in average total costs for firms.
Competition
A market situation in which there are a large number of buyers and sellers.
Monopoly
A market structure dominated by a single seller of a good.
