--%>

Durable goods industries and non-durables industries

Why does the business cycle influence output and employment in durable goods industries more strictly than in industries generating non-durables?

 

E

Expert

Verified

Since durable goods last, consumers can postpone buying replacements. It happens while people are worried regarding a recession & whether there will be a paycheque next month. And firms will soon end generating what people are not buying. Therefore durable goods industries suffer large output declines at the time of recessions. On the contrary, consumers cannot long postpone the buying of non-durables such as food; thus recessions only slightly reduce nondurable output.

   Related Questions in Finance Basics

  • Q : Influence of mergers on fees assessed

    What influence have mergers had on fees assessed for retail bank services? The effect is not clear. Market conditions and the level of competition often determine the cost for retail bank services.

  • Q : Assignments i want to write final

    i want to write final report about my state Texas. using the resources that i attached and the other resources to cover the outlines.

  • Q : Equilibrium GDP for the open economy

    Normal 0 false false

  • Q : Technological improvement of production

    Normal 0 false false

  • Q : Describe capital rationing Describe

    Describe capital rationing? Should a firm practice capital rationing? Why? Capital rationing is the practice of setting dollar restriction on what will be invested in new capital budgeting projects. Proprietorships, partnerships and private c

  • Q : Describe Schedule 8 Schedule 8 : A

    Schedule 8: A detailed listing produced from the State Controller's Office payroll records for a department of its past, present, and budget year positions as of June 30 and updated for the July 1. This listing should be reconciled with each and every

  • Q : Define the term Surplus Define the term

    Define the term Surplus: It is an outdated term for a fund’s excess of assets (or resources) over liabilities.

  • Q : Aggregate expenditure Normal 0 false

    Normal 0 false false

  • Q : Define operating leverage effect and

    Define operating leverage effect and what causes it? Describe potential benefits and negative consequences of high operating leverage? The operating leverage effect is the phenomenon where a small change in sales triggers a comparatively large

  • Q : Describe benefits of the JIT inventory

    Describe the benefits of the JIT inventory control system? The just-in-time (JIT) inventory control system lowers inventory carrying costs & tends to raise quality.