Fixed Resource Prices Help Explain Why Firms

question 15

Multiple Choice

Fixed resource prices help explain why firms

• A)increase output in the short run when the price level increases
• B)keep production levels constant in the short run when the price level decreases
• C)sell output in the short run at fixed prices
• D)increase output in the long run when the price level increases
• E)decrease production when nominal wages fall in the long run

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Definitions:

Processing Department

A functional division within a manufacturing facility where a specific type of production process is carried out.

Ending Work in Process

The value of goods still in the production process at the end of an accounting period.

Processing Department

A division or area in a manufacturing facility where a specific type of processing or production is carried out.

Ending Work in Process

The value of partly finished goods still in production at the end of an accounting period.