production, costs and revenue

Question 1

What is specialisation?

Answer 1

a worker only performing one task or narrow range of tasks. Also different specialising in producing different good or services e.g., cleaners and managers

Question 2

What is division of labour

Answer 2

this concept goes hand in hand with specialisation, different workers perform different tasks in the course of producing a good or service.

Question 3

what is the law of diminishing marginal returns?

Answer 3

is a theory in economics that predicts that after some optimal level of capacity is reached, adding an additional factor of production will actually result in a smaller increase in output

Question 4

what is economies of scale ?

Answer 4

as output increases, long run average cost falls

Question 5

what is diseconomies of scale?

Answer 5

as output increases, long run average costs increases