03.06 Building a Better Business Quiz – Flashcards
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In general, what kind of people earn the most money?
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People with skills that are in high demand but low in supply-
Salaries are determined by the number of people available to work (supply) and the need for a particular skill set (demand). People who have rare, desired skills will probably earn the most money.
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What can a business do to improve its productivity?
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Invest in capital-
Productivity is the efficiency of production, so investing in capital-tools humans create to make a business more efficient-could increase productivity if they made workers' jobs easier or more efficient.
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A construction company has 12 workers who are paid minimum wage. The company wants to reduce costs because there is less work. Which option would be more effective?
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Select several workers to be laid off-
In this scenario, there is too little work for the current staff of a construction company. As fewer workers are required to meet the demand, reducing the number of workers is the most effective way to cut costs.
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The Custom Halloween Company purchases a new sewing machine to replace an older machine with limited capabilities. The first week the new machine is used production nearly doubles. Which economic principle does this illustrate?
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The impact of capital investments-
In this scenario, buying a new sewing machine represents a capital investment. The machine increased productivity.
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he Animè Sushi Bar collects data on how many dragon rolls and sashimi are made per hour. Dragon rolls take longer to make than sashimi. What might explain the difference in production between Week 1 and Week 2?
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Adding a chef-
in the graph, Week 1's production is in all ways lower than Week 2's. Hiring a new chef increases the number of rolls that could be made at any given time, thereby increasing overall productivity.
