Question

review

1. a large company builds a new factory in a small town. soon new restaurants and other businesses open near the factory. the town widens and improves roads near the factory to accommodate deliveries, shipping, and other traffic. people move to the town to find work. new schools open, and a shopping mall is built.

what best explains all this growth and change?
a. fiscal policy
b. productivity
c. specialization
d. interdependence

1. which of the following best defines profit margin?

a. how much money a business receives from its sales
b. how much of its income a business has left after paying its expenses
c. how much money a business spends to produce its goods or services
d. how much of its income a business has to spend on its input and combined
check your understanding
on the following chart, circle the number of any question you answered incorrectly.

Explanation:

For Question 18:

The factory's arrival triggers a chain of interconnected economic and community changes: the factory creates jobs, which attracts residents, which spurs new businesses and public infrastructure improvements. This mutual reliance between the factory, workers, local businesses, and the town government is interdependence. Fiscal policy refers to government tax/spending actions, productivity is output per input, and specialization focuses on narrow production, none of which fit this scenario.

For Question 19:

Profit margin represents the portion of revenue that remains as profit after all expenses are paid. Option A describes total revenue, option C describes production costs, and option D describes total input costs, none of which define profit margin.

Answer:

1. D. interdependence
2. B. how much of its income a business left after paying its expenses