What Did Schumpeter Mean by the Term 'Creative Destruction

question 5

Multiple Choice

What did Schumpeter mean by the term 'creative destruction'?

• A) That in the competitive process new business ideas would replace older ones, and that this process of innovation would inevitably mean that change would occur with old companies, products, or processes being replaced by new ones
• B) That new ideas may sometimes have harmful effects
• C) That capitalism as an economic system would destroy itself through competition
• D) That because businesses were under pressure to invest in new technology, they would constantly be facing falling profits and would inevitably fail

---

Definitions:

Freight

The charge paid for transport of goods by sea, air, or land, typically based on the weight and distance of the shipped items.

Cash Discount

A reduction in the price of goods or services offered to purchasers as an incentive for early payment.

Discount Date

The specified date when a payment is to be made with a discount for early settlement.

Due Date

The due date is the date by which a payment, bill, or other obligation must be paid.