Which of the Following Factors Was Primarily Responsible for the Excess

question 91

Multiple Choice

Which of the following factors was primarily responsible for the excess in production capacity in the United States after World War II?

• A) The United States government raised the tariffs on most imports by 60%.
• B) Many firms from other nations shifted their production facilities to the United States.
• C) Domestic demand was at a historic low and resulted in excess capacity.
• D) The returning military after World War II increased the labor supply in the United States.
• E) The implementation of the Marshall Plan dampened the overseas demand.

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Definitions:

Short Run

A period in economics during which at least one factor of production is fixed, affecting production capabilities.

Long Run

A period in which all factors of production and costs are variable, allowing for full adjustment to changes in economic conditions.

Average Cost

The total cost of production divided by the number of units produced, providing a measure of the cost per unit of output.

Total Costs

The complete sum of all expenses, direct and indirect, incurred in the production of goods or services.