The Amount of Cost Cutting Technical Innovation Introduced into a Production

question 26

Multiple Choice

The amount of cost cutting technical innovation introduced into a production process is a function of:

• A)technology only.
• B)technology and consumer acceptance.
• C)consumer acceptance only.
• D)none of the above.

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Definitions:

Frictional Unemployment

A form of temporary unemployment that occurs when workers are between jobs or are searching for new jobs that better match their skills.

Efficiency Wages

Wages set by employers above the market equilibrium to increase productivity and reduce employee turnover.

Natural Rate

Refers often to the natural rate of unemployment where the economy is in equilibrium, or the natural rate of interest that corresponds to the equilibrium in the loanable funds market.

Structural Unemployment

Unemployment that stems from changes in industrial structures, primarily driven by technological progress, rather than by shifts in supply or demand levels.