(Figure: Investment in Human Capital) in the Graph, Anything That

question 229

Multiple Choice

(Figure: Investment in Human Capital) In the graph, anything that _____ the demand for funds from D₀ to D₁ will result in _____ human capital investment.

• A) increases; decreased
• B) increases; increased
• C) decreases; increased
• D) decreases; decreased

---

Definitions:

Substitution Effect

The change in consumption patterns due to a change in the relative prices of goods, leading consumers to replace more expensive items with cheaper substitutes.

Output Effect

The impact that changes in production levels have on a company's total revenue, often influenced by market demand and price.

Fixed Proportions

A production scenario where inputs must be combined in strict, fixed ratios to produce an output, allowing no substitutions.

MRP

Stands for Material Requirements Planning, a system for calculating the materials and components needed to manufacture a product.