Specialisation and division of labour Flashcards

1
Q

What is the division of labour?

A

Occurs when the work is split up into small specialised tasks.

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2
Q

What was Adam Smith stance on the division of labour?

A

In The Wealth of Nations Adam Smith set out the view that economic growth could be achieved by increasing the division of labour.

He used the example of pin making to demonstrate the division of labour

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3
Q

What are the advantages of division of labour?

A

Each worker specialised in tasks for which that worker is best suited

Reduced training costs for firms

Less time is wasted

Increased productivity and reduced costs of production

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4
Q

What are the disadvantages of labour?

A

Monotony and boredom of workers

Loss of skills

A strike by a group of workers could stun production

Lack of variety

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5
Q

What are the limits to the division of labour?

A

Size of the market

Type of product

Transport costs

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6
Q

What is money?

A

Refers to anything that is used as a means of exchange for goods and services

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7
Q

What are the key functions of money?

A

Medium of exchange

A store of value

Measure of value

Means of deferred payments

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