Which of the Following Is an Example of the Division

question 97

Multiple Choice

Which of the following is an example of the division of labor?

• A) an author writing a book one chapter at a time
• B) a firm trying to get rid of a labor union
• C) separating resources into four categories: land, labor, capital, and entrepreneurial ability
• D) allocating revenue among a firm's resource suppliers
• E) dividing an assembly process into separate stages of production

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Definitions:

Utility Function

An economic model that describes how consumers rank different bundles of goods according to the levels of happiness or satisfaction they provide.

Risk Neutral

A term describing an individual or entity that does not prefer or avoid risk, implying indifference to the amount of risk associated with any investment.

Risk Averse

A characteristic of individuals who prefer to avoid risk and would rather choose an option with a lower but more certain return than an option with a higher but uncertain return.

Von Neumann-Morgenstern

Pertains to a theorem used in expected utility theory, which provides an axiomatic basis for the selection of optimal choices under uncertainty.