LS5 - Specialisation Flashcards
Specialisation
When firms concentrate on the production of a limited range of goods and services.
Division Of Labour
Specialisation of workers on specific tasks in the production process.
Productivity Equation
Productivity = Output Produced/Total Inputs Used
What Does Increased Productivity Lead To
Higher Output And Higher Quality.
Higher Living Standards.
More Efficient Use Of Resources.
Advantages Of Specialisation
Increased quality/quantity of goods.
More efficient use of scarce resources
Increased international trade
Higher Economic growth and therefore higher living standards.
Disadvantages Of Specialisation
Over-reliance on a few industries is risky.
Increased interdependence reduces self-sufficiency.
Advantages Of Division Of Labour
Workers become skilled
Output increases
Time is saved
Workers are easier and cheaper to train.
Disadvantages Of Division Of Labour
Repetition of tasks can lead to boredom and morales to drop.
Simplified job roles can reduce the pride workers feel in their jobs.
Functions Of Money
Medium Of Exchange
Measure Of Value
Store Of Value
Method Of Deferred Payments
Medium Of Exchange
The currency used to facilitate the trade of goods between parties.
Measure Of Value
Allows the values of different goods and services to be compared.
Store Of Value
An asset that can be saved in the future without deteriorating in value
Method Of Deferred Payments
Allows debt to be created
Unit Cost Equation
Total Production Costs In Period/Total Output in Period
