A small increase or decrease in consumer demand can produce a much larger change in demand for the facilities and equipment needed to manufacture the consumer product.What is this a result of?

Question

Quizplus · Accepted Answer

This is a result of the multiplier effect, which suggests that a small change in demand for a product or service can lead to a larger change in demand for the facilities and equipment needed to manufacture that product or service. As a result, businesses must be prepared to meet increased demand by investing in additional resources, such as machinery and skilled labor.

A Small Increase or Decrease in Consumer Demand Can Produce