Which of the following is a short-run decision for a firm?
A) downsizing the firm's manufacturing plant
B) expanding the firm's distribution network of long-haul freight trucks and smaller delivery trucks
C) firing workers
D) investing in a new addition to the firm's manufacturing plant
Answer: C
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If the government wants to raise tax revenue and shift most of the tax burden to the sellers, it would impose a tax on a good with a:
a. steep (inelastic) demand curve and steep (inelastic) demand curve. b. steep (inelastic) demand curve and a flat (elastic) supply curve. c. flat (elastic) demand curve and a steep (inelastic) supply curve. d. flat (elastic) demand curve and a flat (elastic) supply curve.
Other things the same, during recessions taxes tend to
a. rise. The rise in taxes stimulates aggregate demand. b. rise. The rise in taxes contracts aggregate demand. c. fall. The fall in taxes stimulates aggregate demand. d. fall. The fall in taxes contracts aggregate demand.