Ask Question
BusinessBusiness
1 November, 16:08

According to the output effect of a factor price increase, the demand for A) the factor whose price has increased will decrease, but the demand for the other factors

will increase.

B) all factors decreases.

C) all factors increases.

D) the factor whose price has increased will increase, but the demand for the other factors

will decrease.

+3
Answers (1)
  1. 1 November, 16:21
    0
    A) the factor whose price has increased will decrease, but the demand for the other factors

    Explanation:

    The production of goods and services in an economy comes from the combination of factors of production, for example labor and machinery. When the price of one of the factors of production increases, the quantity demanded by that factor will decrease, since there will be a rearrangement in production to alter the necessary composition between the factors in the production of a good. In other words, one factor will be replaced by another as much as possible.

    For example, if the shoe production uses 2 machines and 10 workers. If the price of labor increases, the company may invest in buying one more machine and reducing the number of workers to 5.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “According to the output effect of a factor price increase, the demand for A) the factor whose price has increased will decrease, but the ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers
You Might be Interested in
Segments of business's macroenvironment include all of the following except a. the economic environment. b. the social environment. c. the political environment. d. the natural environment.
Answers (1)
Real World Financials ABC Corporation reported the following information in its financial statements for three successive quarters ($ in millions) : Three Months Ended 9/30/2017 (Q1) 6/30/2017 (Q4) 3/31/2017 (Q3) Balance sheets: Accounts receivable,
Answers (1)
12. Under which circumstances might a business decide to produce its products in various locations rather than use a central distribution center?
Answers (1)
Suppose that an economy has 9 million people working full-time. it also has 1 million people who are actively seeking work but currently unemployed as well as 2 million discouraged workers who have given up looking for work and are currently
Answers (1)
A primary reason for a firm to pursue an acquisition is to: a. avoid increased government regulation. b. exit a hyper-competitive market. c. achieve greater market power. d. achieve greater financial returns in the short run.
Answers (1)
New Questions in Business
JRN Enterprises just announced that it plans to cut its dividend from $3.50 to $2.50 per share and use the extra funds to expand its operations.
Answers (1)
Sykora, Inc., which uses a predetermined overhead rate based on direct labor hours, estimated total overhead for the year to be $12,000,000 and total direct labor hours to be 320,000 hours. Calculate Sykora's predetermined overhead rate.
Answers (1)
Appalachian mountain goods has paid increasing dividends of $.10, $.12, $.15, and $.20 a share over the past four years, respectively.
Answers (1)
What type of skills tends to be equally important at all levels of management? a. technical skills b. human skills c. decisional skills d. motivation to manage e. conceptual skills
Answers (1)
Faldo Corp sells on terms that allow customers 45 days to pay for merchandise. Its sales last year were $325,000, and its year-end receivables were $60,000. If its DSO is less than the 45-day credit period, then customers are paying on time.
Answers (1)
Home » Business » According to the output effect of a factor price increase, the demand for A) the factor whose price has increased will decrease, but the demand for the other factors will increase. B) all factors decreases. C) all factors increases.
Sign Up Forgot Password?