Since Some Innovations Succeed, While Others Fail, It Is Reasonable

question 43

True/False

Since some innovations succeed, while others fail, it is reasonable to assume that industries with innovative activity may still be characterized by zero economic profit.

---

Definitions:

Production

The process of combining various material inputs and immaterial inputs (plans, know-how) to make something for consumption (the output).

Inventories

Goods and materials that a business holds for the purpose of sale or production in the future.

Autonomous Investment

Investment that is not influenced by the current level of income or production, often driven by technological innovations or changes in policy.

Aggregate Expenditure Line

A visual depiction in macroeconomics illustrating the overall expenditures on goods and services within an economy across different income levels.