1971-03-22 — Page 26

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1971 英文中學會考試題預習專欄

經濟及公共事務科

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Economic and Public Affairs

Lesson 21

21st March, 1971.

Answers to Exercise 20

What are the main branches.. production 2

Trace the stages in the flow of a commodity from the producer to the final consumer..

Answer I Under the term production, three broad classes of occupations can be derived

Industrial Occupations

Under this category we include two. main sub-divisions, viz. extractive industries and manufacturing ind ustries.

The first group includes the ex- traction of raw materials (as in quarrying, mining, lumbering) or foodstuffs (as in fishing, rice- growing, poultry farming, vegetable and fruit cultivation). It is also known as "primary production". With manufacturing industries should) involve the turning of these. materials into finished goods in the form of production in light or heavy industries. This type of production varies from handmade cottage industries to the building of huge ships... "Secondary product- ion" is another term given to these items of manufacturing industries..

3

Commercial Occupations

raw

While production makes the meeting. of consumers' needs possible, dis- tribution of products enables the finished goods to reach the final

consumers. These long pro-

vide a link between

Producers

and the consumers and are indis- pensable because the process of production will not be completed until a commodity has reached the consumer. They include, most in- portant of all, the transference and distribution of manufactured goods from the manufacturers to the consumers,

Another term for this division is "tertiary production" which comp rises the following:-

a) the buying, selling and distribution of goods through agents, importers, exporters, whole- salers and retailers,

b) entrepreneurs who anticipate

market conditions and estimate the probable demand for commodities,

c) auxiliary services to trade such as advertisements, transport, communications, insurance, banking and finance, etc.

Direct Services -- ave

Material ends will increase in society with a high standard of living. - This is equally applicable to the wants of a non-material kind. In other words, the higher the standard of living the greater will be the number of people engaged in direct services. Under this cate- gory are services provided by doctors, dentists, nurses, teachers. police, solicitors, civil servants, local government officers, profess-

ional entertainers, hotel employees, and many others, with the provision of these direct services, other Occupations are allowed to be main- tained with ease and security.

The stages in the flow of a commodity from the producer to the final con- sumer is that part of commerce concern-) ed with the actual buying and selling of goods. This is commonly known as Home trade which is of two kinds --- Trade and Foreign Trade.

By Home Trade we refer to the trade which carried on among the people of the country itself. This is essent- ially the purchase and sale of goods by home consumers from manufacturers. through the wholesalers and retailers. Three classes of people are working closely together so that Home Trade of a country can be carried on smoothly.

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There is the Creative Class which

consists of the merchants who import

abroad as well as the home. manufacturers, They all contribute their work to supply the needs of the local market.

or purchase goods from

The Intermediary Class, which consists of wholesalers, take over the goods in large quantities from the Creative Class for the purpose of selling them to retailers in smaller amounts.

The stages in the flow of a comm modity from the producer to the final. consumer is ended with the work cont- ributed by the Distributive Class which reaches individual consumer dir-

Essentially ectly and personally.

trade is carried out by retailers who own small and independent trading units in the form of retail shops or ] departmental stores.

We now are coming to the discuss- ion of the extension of Home Trade -- Foreign Trade, which deals with the

Again, external trade of a country.

一期星日二廿月三年一七九一曆公年十六國民華中 育教僑華

two classes of people are contributing their services so that the trade of a country with other countries is possible!

The

with the first division should include the Importers who purchase goods from overseas manufacturers to supply their home consumers. Exporters, on the other hand, supply the foreign consumers with goods which they themselves purchase from various home manufacturers. Except special

by direct manufactur-

transactions which are

contract between forede

ers and home consumers, Foreign Trade as carried out by wholesale merchants.

No matter what kind of trade it 1 may be, had it not been with the ex- istence of purely commercial underta- kings including which are trans- port facilities, warehousing, banking, insurance and various professional services trade will not be to feasible.

What is meant by division (speciali- sation) of labour 3

What are the main advantages and di advantages of it 7

swer 2- In primitive societies, a man

had to make everything for his own use. Living under such conditions he was able to do little more than satisfy his most pressing needs.

At a later stage, a rather weak form of specialisation existed when people exchanged some of the things they

e of had made for other things they wanted.

specialisation In modern societies this or division of labour is

a very extreme degree practised to

a piece of work is divided into different parts and each worker will only be responsible

or a part of the work.

Adam Smith, the famous author of Inquiry into the Nature and Causes of the Wealth of Nations", was great- ly amazed when observing the work of pin-making factory being carried on in different processes. He wrote s

"One man draws out the wire, ano ther straights it, a third cuts it, a fourth points it, a fifth grinds it at the top for receiv ing the head; to make the head requires two or three distinct operations; to put it on isa peculiar business, to whiten thej pins is another; it is even a trade by itself to put them into the paper; and the important bus- iness of making a pin is, in this manner, divided into about eigh- teen distinct operations, which,

in some manufactories, are all performed by distinct hands,

With this simple illustration, Adam Smith tried to bring out the fact that specialisation will always lead to a huge expansion of output. As a result of division of labour, each worker of this pin-making factory was able to produce from only 20 pins per day to 4,800 pins per day,

To speak in favour of division. of labour, we can see it enables per. sons to ac uire an aptitude for a particular task by learning it and practising it. "Practice makes per-. fect", greater skill can be acquired by a worker through constant repetit- ion of a performance. Specialisation enables differences in natural aptit- udes to be utilized. Employment of specialists is possible as a man can concentrate on the work he does best. It will also be a saving of time as individual worker tends to keep to a single operation. He does not waste

time moving between different operat- ions. Division of labour widens the

If a piece utilization of machinery.

of work is disintegrated, it becomes more possible for the employment or machines to perform different operat-> ions for the different parts. It is also believed that under specialisation of labour, a worker may be subjected to less fatigue because he can work leisurely.

On the other hand, inevitable drawbacks may result from specialis- ation of labour. Boredom can be caused by doing the same performance continually. There is a greater risk of unemployment if demand for a particular product drops when a man has. not been trained for other works Moreover, there will be a decline of craftsmanship as a worker is merely a tender of the machine under special isation of labour.

However, it can be seen that the 1 advantages of specialisation easily overcome the disadvantages so derived. Therefore specialisation still proves itself to be a very effective means of production on condition that it is carefully operated.

Exercise 21

1. Make a list of the different types of

business unit under a system of free enterprise.

II. Select the one that BEST answers the

the statement

question or completes the st

The amount added to total income by. the sale of one additional unit of a product is known as the

a. marginal cost.

b. marginal utility.

c. marginal product.

d. marginal revenue.

e. marginal efficiency of capital.]

2. Which of the following case will the cost of production have the greatest influence on the price of a commodity a. toys sold by a manufacturer b. fresh water-melons in a retail

shop

paintings in contemporary style offered for sale at an exhibition antiques in the hands of an art dealer

none of the above

Which one of the following is not

a characteristic of industries gener-

ally considered to be public utilities 2

there are in most cases no close substitutes

b. they are usually under monopoly c. their life is uncertain and

short-termed

they are frequently decreasing cost industries

duplication of service may lead to inefficiency or inconvenience to customers.

Which of the following is not demand determinant

a.

consumer's income. b. consumer's tastes

prices of substitute products consumer's expectations

, behaviours of other consumers

Which of the following descriptions best suited demand in an economic sense

a psychological behaviour an intense desire for material goods A

a willingness to buy plus purchas- ing power ·

a mere desire of buying and possessing

a born-nature of human beings,

Which of the following would cause à considerable reduction in a consu- mer's demand for product A 2

a, the consumer's income has been 3

increased

b. a decrease in the supply of 1

product A

an increase of price of product A in the future is expected by the

consumer

the prices of goods which are good] substitutes for product a reduceda

fear of war in the future

Assuming no change in supply but an increase in demand, one would expect a. price to rise and the quantity

sold to increase's

price to rise and the quantity sold to decrease.myl

price to fall and the quantity sold to increase.

de price to fall and the quantity]

sold to decrease.

no change in price or quantity

sold.

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