Post Utme Afe Babalola University 2017 Commerce Question 6

Practice objective / multiple choice question 6 from the 2017 Post Utme Afe Babalola University Commerce examination.

Post Utme Afe Babalola University 2017 Commerce Objective / Multiple Choice
Question 6 POST_UTME_AFE_BABALOLA_UNIVERSITY • 2017 • COMMERCE • objective

The concept of specialization in production is closely related to the idea of comparative advantage. Explain how specialization leads to increased productivity and efficiency in a market economy.

Answer Options

A. Specialization leads to increased productivity and efficiency because it allows firms to focus on producing a specific good or service, leading to economies of scale.
Correct Answer B. Specialization leads to increased productivity and efficiency because it allows firms to take advantage of their comparative advantage, leading to a more efficient allocation of resources.
C. Specialization leads to decreased productivity and efficiency because it limits the range of goods and services that firms can produce.
D. Specialization has no impact on productivity and efficiency in a market economy.
Correct Answer
B
Correct Option:
Specialization leads to increased productivity and efficiency because it allows firms to take advantage of their comparative advantage, leading to a more efficient allocation of resources.

About This Question

This is Post Utme Afe Babalola University 2017 Commerce Question 6. It is one of the objective questions from the 2017 Post Utme Afe Babalola University Commerce examination.

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