Refer to the Graphs

question 218

Multiple Choice

Refer to the graphs. Suppose a firm is currently producing 500 computers per week and charging a price of $1,000. How will the firm respond to a positive demand shock if prices are inflexible?

• A) The firm will increase production to 650 computers per week and charge a price of $1,000.
• B) The firm will continue to produce 500 computers per week and charge a price of $1,000.
• C) The firm will cut production to 300 computers per week and charge a price of $1,000.
• D) The firm will cut production to 300 computers per week and charge a price of $600.

---

Definitions:

Weighted Average Delay

implies the average time delay in a process or system, adjusted for the importance or frequency of each delay component.

Collection Delay

The time lapse between when a payment is made by a customer and when the funds become available to the recipient company.

Average Amount

The mean sum of a group of numbers, calculated by dividing the total by the quantity of numbers.