Don's Pasture Apple Cider Company Buys Four Inputs: Apples, Glass

question 30

Multiple Choice

Don's Pasture Apple Cider Company buys four inputs: apples, glass bottles, apple presses, and computers for record keeping.If the company decides to become more vertically integrated, it will

• A)probably start growing apples next
• B)probably start making glass bottles next
• C)probably start making apple presses next
• D)probably start making computers next
• E)have to grow apples and make glass bottles, apple presses, and computers

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Definitions:

Investment

The act of allocating resources, usually money, with the expectation of generating an income or profit.

Comparative Advantage

The ability of a country, individual, company, or region to produce a good or offer a service at a lower opportunity cost than competitors.

Capital

Resources made and used by people to produce and distribute goods and services, including buildings, machinery, tools, and equipment.

Investment

Utilization of resources (such as capital, time, or effort) with the expectation of achieving a future return, often through the acquisition of assets or improvement of productivity.