Adam Smith Explains That Industrial Societies Can Increase Output Using

question 12

Multiple Choice

Adam Smith explains that industrial societies can increase output using the same labor-hours as in preindustrial society through:

• A)Comparative advantage
• B)Division of labor
• C)Opportunity costs
• D)Gains from trade
• E)Absolute advantage

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Definitions:

Fixed Costs

Expenses that do not change with the level of production or sales activity, such as rent, salaries, and insurance.

Per Unit

A term used to express data, costs, or values on a per single unit basis, facilitating easier comparison and calculation.

Account Classification

The process of organizing accounts into categories within the financial statements, based on their nature and function.

Cost-Estimation

The process of forecasting the costs associated with a particular activity, project, or product, using historical data, statistical methods, and expert judgment.