specialisation division of labor and exchange Flashcards
what is specialisation
when individuals, businesses, or countries focus on producing a specific good or service in which they have a comparative advantage. It’s like becoming an expert in one thing and leaving other tasks to those who can do them better. Specialization allows for increased efficiency, higher productivity, and overall economic growth.
which economist observed the division of labour in a pin factory
adam smith
how does the division of labour result in higher output
The division of labor results in higher output because it allows workers to specialize in specific tasks. When each worker focuses on a specific task, they become more skilled and efficient at it over time. This specialization leads to increased productivity and faster production
how might the division of labour result in higher quality
When it comes to the division of labor, higher quality can also be a result. By focusing on specific tasks, workers can become experts in their area, honing their skills and knowledge. This specialization allows them to develop a deep understanding of their particular task, leading to improved quality in their work. With each worker dedicated to their specialized role, they can pay close attention to detail and ensure that their part of the process is done with precision. So, the division of labor can contribute to higher quality output as well! 🌟👩🔬👨🔧
how might specialisation result in lower cost
When workers specialize in specific tasks, they become more efficient and skilled at what they do. This increased efficiency leads to time savings and reduces the chances of errors or rework. As a result, production costs can be reduced.
what are the functions of money
médium of exchange
unit account
store of value
standard of deferred payment
what is medium of exchange
Medium of Exchange: Money is used as a widely accepted medium to facilitate the exchange of goods and services. Instead of bartering, people can use money to buy what they need.
what is unit of account
money provides a common unit of measurement for pricing goods and services it allows for easy comparison and valuation of different items
what is store of value
money can be saved and stored it retains its value over time, allowing individuals to save and accumulate wealth
what are the advantages of specialisation
•higher output = more trade+ more growth
•wider range of goods and services
•greater allocative efficiency
•higher productivity through better use of workers
•quality improvements
what are the disadvantages of specialisation
finite resources
changes in fashion/tasks
de-industrialisation
national independence
what is division of labour
breaking down the production process into separate tasks upon specialisation
what are the advantages of division of labour
workers highly productive which leads to increased wage, time savings costs of production decrease and prices also decrease
•specialist capital for workers
•lower prices, higher quantity/ choice and quality for workers
what are the disadvantages of division of labour
démotivation of workers
high worker turnover
rush of long term unemployment
highly standardised good/service
