If a product loses weight during production, reducing transport costs, the industry is described as what?

If a product loses weight during production, reducing transport costs, the industry is described as what?

• A. bulk-increasing
• B. service industries
• C. manufacturing
• D. bulk-reducing

Answer: (D)

This question tests how the weight change of a product through production affects where industries locate and how transport costs behave. When a product loses weight during production, the final output is lighter than the inputs, so transport costs are reduced for the finished goods relative to moving the bulkier inputs. This pattern is called a bulk-reducing industry. Because most of the bulk is in the raw materials, firms in bulk-reducing industries typically locate near their sources of raw materials to minimize the cost of moving bulky inputs, while still shipping the lighter final product to markets. The other terms don’t fit this pattern: bulk-increasing would mean outputs are heavier than inputs; service industries are intangible and not defined by weight changes; and simply calling something manufacturing doesn’t capture the bulk-change aspect.

This question tests how the weight change of a product through production affects where industries locate and how transport costs behave. When a product loses weight during production, the final output is lighter than the inputs, so transport costs are reduced for the finished goods relative to moving the bulkier inputs. This pattern is called a bulk-reducing industry. Because most of the bulk is in the raw materials, firms in bulk-reducing industries typically locate near their sources of raw materials to minimize the cost of moving bulky inputs, while still shipping the lighter final product to markets. The other terms don’t fit this pattern: bulk-increasing would mean outputs are heavier than inputs; service industries are intangible and not defined by weight changes; and simply calling something manufacturing doesn’t capture the bulk-change aspect.