Industrial Firms Choose Locations That Minimize Cost, but Service Firms

question 41

Short Answer

Industrial firms choose locations that minimize cost, but service firms look for locations with good demographics and traffic count because these variables are indicators of good ________.

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Definitions:

Households

Economic units consisting of all the people who occupy a housing unit, making decisions about resource allocation, consumption, and labor supply.

Goods and Services

Physical items (goods) and intangible benefits (services) that fulfill human wants or needs.

Factors of Production

Resources used in the production of goods and services, traditionally categorized as land, labor, capital, and entrepreneurship.

Circular-Flow Diagram

An illustrative depiction of the economy, highlighting the movement of currency among firms and households within different markets.