If a Firm Increases the Ratio of Capital to Labor

question 128

Multiple Choice

If a firm increases the ratio of capital to labor, it becomes more:

• A) labor intensive.
• B) output intensive.
• C) capital intensive.
• D) cost intensive.

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Definitions:

Financial Statement

A formal record of the financial activities of a business, person, or other entity, presenting its financial performance and position at a given point in time.

Specific Date

A particular day singled out from others because of its significance or relevance to an event or action.

Supplies on Credit

The acquisition of business supplies with an agreement to pay the supplier at a later date.

Accounting Equation

The fundamental equation of double-entry bookkeeping, stating that assets equal liabilities plus equity (Assets = Liabilities + Equity).