The Invisible Hand Definition
The invisible hand was first coined by Adam Smith who explained how the self-interest of the individual benefits the rest of society.
Opportunity Cost and the Division of Labor
Opportunity cost looks at the cost of taking one option over another. In other words what is the sacrifice that must be taken to choose one choice over another. This might include time, money, or even convenience.
In this section, we also include the division of labor – which helps reduce the opportunity cost of production. By dividing labor, tasks can be done more efficiently. The reasoning behind this is that by having individuals specialise in one area, they are better able to maximise their output through greater expertise.
Division of Labor Definition
The division of labor refers to the segmentation of tasks, so each person focuses on a specific part of the production process.
Opportunity Cost: Definition, Types, Examples
Opportunity cost is the price we pay to take one action over another.
