Concerned That Its Dependence on Sales of Microprocessors to Computer

question 302

Multiple Choice

Concerned that its dependence on sales of microprocessors to computer firms would make it vulnerable to sharp sales declines during the recession of 2007-2009,Intel began to develop memory chips that could be used in portable consumer electronic devices such as tablets and smartphones.One reason that Intel chose to branch out from producing microprocessors for computers is that

• A)sales of computers have been declining over the past decade.
• B)technology with respect to microprocessor production was no longer advancing at a rate where Intel's new products were still wanted by computer manufacturers.
• C)Intel had lost a majority of its market share in microprocessor production to foreign competition.
• D)computers are durable goods and spending on computers follows the business cycle.

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Definitions:

Comparative Advantage

The ability of an individual, company, or country to produce a good or service at a lower opportunity cost than competitors, leading to more efficient global production and trade.

Consumer Market

A marketplace for goods and services that are purchased for personal, family, or household use.

Manufacturing Base

The sector of an economy that is involved in the production of goods in large quantities, utilizing labor and machines.

Trade Deficit

An economic measure where a country's importation of goods exceeds its exportation, reflecting a net outflow of domestic currency to foreign markets.