Production, Specialisation and Exchange

  • Created by: izzy
  • Created on: 10-06-13 14:23
  • Production is a process, or set of processes, that converts inputs into outputs.
  • Productivity is measured by output per unit of input.
  • Labour productivity, or output per worker, id the mosst commonly used measure of productivity.
  • The division of labour means that different workers do different jobs.
  • The division of labour and specialisation occur together.
  • Specialisation and the division of labour require trade and exchange.
  • Money is the main medium of exchange in modern economies, though barter still sometimes takes place.
  • Average cost is cost per unit of output.
  • A firm's average cost curve


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