Productivity Fluctuates Along a Business Cycle Because

question 209

Multiple Choice

Productivity fluctuates along a business cycle because

• A) firms usually keep excess labor.
• B) workers tend to become more productive during expansions.
• C) workers tend to become less productive during expansions.
• D) Both B and C are correct.

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Definitions:

Equity Multiplier

A financial leverage ratio that measures a company's total assets financed by stockholders' equity.

Sales On Account

Transactions where the customer purchases goods or services on credit, agreeing to pay the seller at a later date.

Cost Of Goods Sold

The direct costs attributable to the production of goods sold by a company, including material and labor costs.

Operating Cycle

The duration of time from the acquisition of inventory to the collection of cash from accounts receivable, representing the process of turning assets into cash.