Question

Firms choose how to produce the goods and services they sell. In many​ cases, firms face a​ trade-off between using more workers or using more machines. For​ example,

A.

many times in the past several​ decades, firms may have chosen between a production method in the United States that uses fewer machines and more workers and a production method in China that uses more machines and fewer workers.

B.

many times in the past several​ decades, firms may have chosen between a production method in the United States that uses fewer workers and more machines and a production method in China that uses more workers and fewer machines.

C.

movie studios have to choose whether to produce animated films using more highly skilled animators to draw them by hand or fewer highly skilled animators and more​ low-skill animators.

D.

a local service station has to choose whether to provide car repair services using more diagnostic computers to support their auto mechanics and fewer tools to support their auto mechanics or more tools to support their auto mechanics and fewer diagnostic computers to support their auto mechanics

Answer 1

Option B.

• Firms usually face trade off between the use of workers or machines for the production of the goods and services they sell.
• This may because of the scarcity of one resource or the bulk abundance of another resource which force's them to substitute one resource with another one.
• If a country becomes more advanced or develops more than another country, they will adopt production methods which use more machines and tools than worker's when compared to a country with slow development.
• For example, many times in the past several decade's, firms in United States might have chosen a production method which uses fewer worker's and more machines while the firms in China might have chosen a production method which uses fewer machines and more worker's.
• This is mainly because US has always experienced a rapid economic growth in production sector when compared to China.