If a Firm Increases Its Use of Capital While Holding

question 57

Multiple Choice

If a firm increases its use of capital while holding constant the number of workers employed, the firm is said to experience

• A)capital augmentation.
• B)investment deepening.
• C)labor intensity.
• D)capital deepening.

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Definitions:

General Ledger

A complete record of all financial transactions over the life of a company.

Debit Balances

Accounts on the left-hand side of a double-entry bookkeeping system that typically signify assets or expenses.

Permanent Account

An account that carries its ending balance over from one accounting period to the next, such as assets, liabilities, and equity accounts.

Doubtful Accounts

Accounts receivable that a company believes it may not be able to collect, often leading to the creation of an allowance for doubtful accounts.