A Firm Practices Input Substitution When It

question 81

Multiple Choice

A firm practices input substitution when it

• A)retrains Joe the welder as a painter and Pat the painter as a welder.
• B)buys extra machines for its workers to use.
• C)allows fixed cost to become variable.
• D)replaces unskilled labor with automated machinery.

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Definitions:

Systematic Risk

The risk inherent to the entire market or market segment, which cannot be mitigated through diversification and is often influenced by external factors like political, economic, and social changes.

Political Upheaval

Significant disruption or change in the governing structure or policy of a country, often accompanied by protests or conflict.

Market Risk

The risk of losses in investments due to factors that affect the entire market, such as economic changes or political events.

Economic Events

Various incidents or transactions that may affect a country's economy, including government policies, market movements, and natural disasters, which can influence financial markets and economic health.