Econ 1 - Production/ Productivity

Question 1

Productive efficiency

Answer 1

when a firm operates at the minimum ATC curve.

Question 2

Specialisation

Answer 2

The production of a limited range of goods by an individual factor of production, for or country in co-operation with others.

Question 3

Division of Labour

Answer 3

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

Question 4

Benefits of division of labour

Answer 4

1. Time saving
2. Increased aptitude
3. Workers do what they are best at.
4. Capital Equipment.

Question 5

Measuring Labour Productivity?

Answer 5

Total output / units of labour

Question 6

Advantages of higher productivity

Answer 6

1. Lower average costs
2. Higher real wages
3. growth of the economy
   - new jobs
   - greater business confidence
   - accelerator effect