The Degree of a Factor's Specificity Is Inversely Related to

question 5

Multiple Choice

The degree of a factor's specificity is inversely related to

• A) the amount of time required to redeploy the factor to a different industry.
• B) factor quality, with lower quality factors having a lower level of specificity.
• C) the cost of the factor as a proportion of the long-run total cost of production.
• D) the mobility of the factor, with more mobile factors having less specificity.
• E) technology differences between two countries, with a less advanced technology resulting in less factor specificity.

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Definitions:

Direct Cost

Expenses directly attributable to the production of goods or services, such as raw materials and labor.

Indirect Cost

Costs not directly traceable to a product, department, or project, such as administration, rent, and utilities.

Manufacturing

The process of converting raw materials, components, or parts into finished goods that meet a customer's expectations or specifications.

Factory Rent

Expenses incurred for leasing a premises to use as a manufacturing or production facility.