Albert's Pretzel Baking Company used to have four workers who were each in charge of making their own pretzels from start to finish.Now,one worker mixes the dough,another shapes it,the third puts the unbaked pretzels into the oven and the fourth removes the finished product.Output has doubled.This is an example of
A) neutral technical change.
B) labor-saving technical change.
C) division of labor.
D) economies of scale.

Question

Quizplus · Accepted Answer

The change from each worker making their own pretzels from start to finish to each worker specializing in one task (mixing, shaping, baking, or removing) is an example of division of labor. This type of specialization can increase efficiency and productivity, as seen by the doubling of output. It is not a neutral technical change, as it involved a shift in the way tasks were organized and carried out by workers. It is also not necessarily a labor-saving technical change, as the same number of workers are still employed, but they are now focusing on specialized tasks. Economies of scale may be a result of this change, but it is not the primary explanation.

Albert's Pretzel Baking Company Used to Have Four Workers Who