Which of the Following Factors in an Industry Is Most

question 18

Multiple Choice

Which of the following factors in an industry is most likely to cause excess capacity?

• A) Technologically outdated production units
• B) High customer demand
• C) A company's investments in newer production technology
• D) Lack of competition from new entrants
• E) Limited number of outlets in certain locations

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Definitions:

Aggregate Demand

The totality of market demand for goods and services within an economy, set at an agreed-upon general price level over an established period.

Money Supply

The total fiscal assets present in an economy at a specific moment.

Long-Run Aggregate Supply

Represents the total output an economy can produce when both capital and labor resources are fully employed at their highest productivity levels.

Money Supply

The sum of all financial assets, such as cash, coins, and the amounts in checking and savings accounts, present in an economy at a given time.