Technological change

Question 1

define technological change

Answer 1

a term used to describe the overall effect of invention innovation and diffusion or spread of technology in the economy

Question 2

effects of TC on methods of production

Answer 2

• move from job prod to flow prod
• move from intensive to capital intensive
• less skilled labour
• eval, skilled labour needed for maintenance

Question 3

define productive effeciency

Answer 3

cant make more of one good without making it less of another, making the most with the factors of production

Question 4

define allocative effeciency

Answer 4

occurs when it is impossible to improve overall economic welfare by reallocating resources, economic resources are used to produce the combination good and services that has best matches people tastes and preferences

Question 5

define dynamic efficiency

Answer 5

occurs in long run leading to the development of new products and more efficient resources that improve productive efficiency

Question 6

TC can

Answer 6

• lead to development of new products
• development of new market
• may destroy existing market

Question 7

define creative destruction

Answer 7

capitalism evolving and renewing itself over time through new tech and innovation replacing older ones