If firms face a weak demand they are more likely to:
A) Buy more raw materials and semi-finished goods.
B) Increase output.
C) Reduce their workforce.
D) Invest in new equipment.

Question

Quizplus · Accepted Answer

If firms face weak demand, they are likely to reduce their workforce in order to cut costs and maintain profitability. Buying more raw materials and semi-finished goods or investing in new equipment would only increase their costs, while increasing output would not be profitable without sufficient demand for their products.

If Firms Face a Weak Demand They Are More Likely