Whenever an Input Makes Up a Large Percentage of a Good's

question 96

Multiple Choice

Whenever an input makes up a large percentage of a good's final cost, an increase in that input's price will

• A) affect total cost relatively more.
• B) not affect total revenues.
• C) affect only accounting profits.
• D) cause the firm to shutdown.

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Definitions:

Normative Economics

An approach to economics that analyzes outcomes of economic behavior, evaluates them as good or bad, and may prescribe courses of action.

Global Warming

Global warming is the long-term rise in Earth's average temperature, primarily due to the increase in greenhouse gases such as CO2 from human activities.

Automobile Emissions

Emissions from automobiles relate to the gases and pollutants released into the environment from the exhaust systems of vehicles, impacting air quality and climate.

Ceteris Paribus

A Latin phrase meaning "all other things being equal," used in economics to isolate the effect of one variable by holding other relevant factors constant.