A Firm's Demand in the Next Four Quarters (Its Aggregate

question 24

Multiple Choice

A firm's demand in the next four quarters (its aggregate planning horizon) is forecast to be 80, 50, 40, and 90 units. Last quarter, the firm produced 60 units. If it uses level scheduling, the firm will.

• A) hire workers to permit production of 65 units per quarter for the next four quarters
• B) hire 20 workers
• C) have an increase in inventory of 20 units in the next quarter
• D) have a decrease in inventory of 5 units in the next quarter
• E) change its workforce each quarter so that inventory does not change

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Definitions:

Government Intervention

Actions taken by a government to affect the economy, which can include regulations, subsidies, and taxes.

Supply-Siders

are economists who believe that changes in marginal tax rates and the ability to supply goods in the economy significantly influence economic growth.

Work More

The concept or action of increasing the amount of effort or hours spent on labor or tasks.

New Classical Economists

Economists who advocate for the theory that markets are clear and that prices, wages, and rates adjust quickly to equilibrate supply and demand.