4642310
Descrição
FlashCards por Maya Khangura, atualizado more than 1 year ago
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Criado por Maya Khangura
quase 9 anos atrás
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| Questão | Responda |
| What is production? | Converts inputs (factors of production) into outputs (goods and services) |
| What does production involve in the short run? | Adding variable factors of production to fixed factors |
| What does production involve in the long run? | All factors of production are variable so production involves changes in scale |
| How is the short run defined? | The time period where one of the factors of production are fixed |
| How is the long run defined? | The time period where no factors of production are fixed - all factors are variable |
| What is productivity? | Rate of production |
| How is productivity measured? | Output per unit of input |
| How can productivity be measured- which is most commonly used? | For all factors of production Labour productivity output per worker |
| What is productivity a measure of? | Competitiveness |
| The higher the rate of productivity... (effect on costs) (2) | the lower the unit cost of production and therefore the lower the price that can be offered to consumers |
| What is specialisation? | When we concentrate on a product or task |
| What does the productivity gap measure? | The differences in labour productivity across a number of countries |
| Where can specialisation happen? | At all levels of economic activity |
| Give example of this (4) | 1) Specialisation of tasks within extended families in many of the worlds poorest countries 2) Within businesses and organisations 3) In a country 4) In a region of a country |
| Give an example of specialisation within businesses and organisations | Mass manufacturing of vehicles Building industry |
| Give an example of specialisation within a country | USA is a leading country in shale oil and gas supplier Bangladesh major producer and exporter of textiles |
| Give an example of specialisation within a region of a country | West midlands has been a centre for more car assembly |
| How can we increase productivity? (2) | Better training/ management Improved technology |
| When does the division of labour occur? | Where production is broken down into many separate tasks |
| What can the division of labour raise- why? | The output per person as people become more efficient through constant repetition of a task |
| What is this process called? | Learning by doing |
| What does this gain in productivity result in? | Lower the supply cost per unit |
| What should reduced supply costs lead to? | Lower prices for consumers of goods and services causing gains in economic welfare |
| What are advantages of specialisation? (3) | 1) Higher labour productivity 2) Creates surplus output that can then be traded internationally 3) Lowers prices |
| Why is higher labour productivity an advantage of specialisation? (3) | Learning by doing increases output per hours worked Higher productivity lowers the unit cost of supply Increased productivity leads to higher profits for businesses |
| Why is the creation of surplus output an advantage of specialisation? (3) | Surplus can be traded internationally Theory of comparative advantage Business/countries specialise in areas of relative advantage |
| Why are lower prices an advantage of specialisation? (3) | Higher real incomes Real GDP growth Lower prices |
| What are the disadvantage of specialisation and the division of labour? (3) | 1) unrewarding, repetative, work that requires little skill can lower motivation, lowering quality and eventually lower production 2) Lack of flexibility- workers struggle to adapt to new jobs (structural unemployment) 3) countries can become less self sufficient- problem in trade unexpec stops |
| Why is trade and exchange necessary? | For specialisation to become economically worthwhile |
| What is a way of achieving this- what does this require? | Barter was a simple method of achieving this, but requires a double coincidence of wants- larger the community the less likely this is to occur |
| If there is a increase in specialisation what happens to productivity? | Increase productivity - LRAS shifts out Show this on a diagram |
| What is money? | Money is a means of exchange that facilitates trade and exchange |
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