1).

Review “How Wealth is Created” on page 15 (chapter 1) and “The Law of Comparative
Advantage” on page 35 (chapter 2) and explain how the division of labor increased
production and a higher standard of material living. How is it possible for workers to
increase their productivity? Is this true only of individuals or is also the case for
communities, states, regions and nations as well? 
The Law of Comparative Advantage gave the example of the surgeon who was a highly skilled
typist, however he would be loosing money if he decided to be his own secretary and type,
instead of hire a secretary so he could spend his full time doing surgeries.
We often hear the phrase “Time is money”, which is true for those who are paid by the hour or
on commission. Many factories have implemented assembly lines because they realize that if
they break down the task and train employees to become efficient in one specialty, they are much
more productive. This is also true as it relates to importing and exporting.. The idea is that if
everyone does their part, the world will be able to create higher standards of living more
efficiently.
2) According to the article I, Pepsi (links to an external site) (Links to an external site.) by
Russell Roberts, 10 to 20 production workers can take over one billion empty soda cans per
year and get them filled and put on a pallet, ready for shipping. What is the unseen marvel
behind such productivity?
This article was truly eye opening as often we do not see finished products for what they
truly are or fully appreciate all the effort that was put into its production. A factory does not
make all of the components from scratch. They outsource or use other inventions or equipment
that was previously available.

3) What role(s) have economies of scale and economies of scope played in the present-day
application of the division of labor and law of comparative advantage?
Economies of Scale is the concept that as more single products are produced it can reduce the
per-unit cost. Economies of Scope occurs when a company produces a variety of different
products and due to the variety, the cost of production is reduced. Following the law of
comparative advantage, economies of scope could be applied if a goods can be produced at a
lower relative opportunity cost.

4) According to Russell Roberts—Do ‘Big Box’ Retailers Harm the Quality of Life? (links to
an external site.) (Links to an external site.)—what are the unseen benefits that "big box"
retailers provide? According to Russell Kirk—The Valley of the Shadow of Books (see
attachment/handout, pages 141-145)—how can the loss of culture and taste combine with
economies of scale and scope to harm us? What are the unseen benefits that small business
owners provide? Following all this, can free economies support both "big box” and “main
street” retailers?
The more products that are able to be produced in mass, the cheaper they are. Walmart and other
large retailers have the benefit of buying and stocking in bulk which in return means they are
able to sell items for much cheaper than stores with less buying power. The unseen benefit to the
consumer is that we benefit by paying less for items, however this means that in exchange for out
discounted item, we are contributing to the downfall of small business owners.