WAEC Commerce 2018 Theory — Question 1

Model answer

(a) Size of the market: a firm cannot continue to expand division of labour without considering the size of the market it intends to serve, since division of labour is meant to increase output, and the market size dictates how much a firm can apply it. Availability of needed skill: when work is divided, specialists are required to handle each division; limited availability of specialists can limit the extent of division of labour. (b) Disadvantages: fatigue — workers involved in the same line of work repeatedly tend to get tired of the job; waste may result because not all labour will be used simultaneously. (c) Advantages: increase in total output since work is divided among labourers; expertise develops as workers specialise and become expert in their tasks, improving quality; economies of large scale reduce cost per unit of output; invention and innovation increase as expertise grows; time saving results from readily available labour to take up work from where another stops.