Innovations That Lower Production Costs or Create New Products

question 77

Multiple Choice

Innovations that lower production costs or create new products

• A)are rare in competitive industries.
• B)discourage new firms from entering the industry.
• C)often generate short-run economic profits that do not last into the long run.
• D)usually generate long-run economic profits for the innovator.

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Definitions:

Market Value

The present cost at which a service or asset is available for purchase or sale in the market.

FIFO

"First In, First Out," an inventory valuation method where goods purchased or produced first are sold or used first.

Realized Holding Gains

Gains recognized from the sale of an investment or asset that were previously unrealized.

Rising Prices

An economic condition characterized by a general increase in consumer prices or the cost of living, often referred to as inflation.