The Right Physical Distribution System Should Be Based Primarily on

question 124

Multiple Choice

The right physical distribution system should be based primarily on

• A) the desired customer service level.
• B) how customers store the product.
• C) the physical characteristics of the product.
• D) what is the lowest cost method of transportation for the product.
• E) the inventory level that allows the smoothest production runs.

Distinguish between households and firms in the context of the circular flow.

Recognize the flow of resources, goods, services, and money in the economy.

Understand the concepts of positive and normative statements in economics.

Differentiate between statements of fact (positive statements) and statements of opinion or policy (normative statements).

---

Definitions:

Aggregate Expenditure

The total amount spent on national-level goods and services in an economy.

Disposable Income

Income available to households after accounting for taxes and social security charges, available for spending or saving.

Gross Domestic Product

The total market value of all final goods and services produced within a country in a specific time period.

Aggregate Expenditure

This is the total spending on final goods and services in an economy, including consumption, investment, government purchases, and net exports.