A Firm That Expands by Producing Its Own Raw Materials

question 38

Multiple Choice

A firm that expands by producing its own raw materials or acquiring a retail outlet to sell its own products is most likely using a strategy of ________.

• A) consolidation
• B) geographic expansion
• C) vertical integration
• D) diversification

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Definitions:

Labor Contracts

Agreements between employers and employees or unions that define terms of employment, salaries, benefits, and working conditions.

Short-run Phillips Curve

A graphical representation showing the inverse relationship between unemployment rates and inflation rates in the short-term.

Per-capita Income

The average income earned per person in a certain area, calculated by dividing the area's total income by its total population.

Rational Expectations School

An economic idea that assumes individuals make predictions about the future based on all available information and past experiences in a rational manner.