Question 21
POST_UTME_VERITAS_UNIVERSITY
•
2023
•
COMMERCE
•
objective
The concept of specialization in production is closely related to the idea of comparative advantage. Explain how specialization leads to increased efficiency and productivity in a market economy.
Answer Options
A.
Specialization leads to increased efficiency and productivity by allowing firms to focus on producing a specific good or service, thereby reducing production costs and increasing output.
B.
Specialization leads to decreased efficiency and productivity by forcing firms to produce a limited range of goods or services, thereby reducing their ability to adapt to changing market conditions.
C.
Specialization has no impact on efficiency and productivity, as firms will always produce a mix of goods and services regardless of their specialization.
Correct Answer
D.
Specialization leads to increased efficiency and productivity by allowing firms to take advantage of economies of scale, thereby reducing production costs and increasing output.
Correct Answer
D
Correct Option:
Specialization leads to increased efficiency and productivity by allowing firms to take advantage of economies of scale, thereby reducing production costs and increasing output.
About This Question
This is
Post Utme Veritas University
2023
Commerce
Question 21.
It is one of the
objective
questions from the
2023
Post Utme Veritas University
Commerce
examination.