The Ease of Adjusting Resources in Response to Changes in Demand

question 47

Multiple Choice

The ease of adjusting resources in response to changes in demand defines firm's

• A)vertical integration
• B)process flexibility
• C)customer involvement
• D)capital intensity

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Definitions:

Income

Money received, especially on a regular basis, by an individual or business in exchange for providing labor, goods, or services, or through investing.

MPC (Marginal Propensity to Consume)

The proportion of an increase in income that is spent on consumption rather than being saved.

Government Purchases Multiplier

The ratio of change in aggregate economic output to a change in government spending, used to analyze the effect of fiscal policy on the economy.

Aggregate Demand

Total economic need for all goods and services within an economy, pegged at a designated price level during a chosen period.