Final answer:
Level production methods indeed smooth production schedules and can be more efficient than seasonal methods by leveling manpower and equipment utilization. When machine hours are cheaper, businesses like Ford's assembly line showed a shift towards machinery, as outlined by a move from production technology 1 to 3, highlighting a focus on lowest total cost and efficiency.
Step-by-step explanation:
The statement that level production methods smooth production schedules and utilize manpower and equipment more efficiently than seasonal production methods is generally true. Level production involves producing at a constant rate, avoiding the highs and lows of seasonal demand. This can lead to improved efficiency and lower costs in many cases.
Moreover, with reference to production technology and cost, firms often shift their production strategies based on the cost of inputs. For instance, if machine hours become cheaper, a firm is likely to choose a production technology that utilizes more machinery and less labor, such as production technology 3, which has the lowest total cost. This decision is based on the economic principle of cost minimization, where firms adjust input combinations to reduce costs and hence increase efficiency.
During the early 20th century, Ford's assembly line methods clearly demonstrated how shifting from skilled craftsmanship to an assembly line increased efficiency but affected worker satisfaction and the labor market. As labor costs rise, businesses tend to substitute labor with machinery as shown in the examples outlined in Table 7.14, where production technology shifts are evident from technology 1 which uses the most labor towards technology 3 which uses the least labor.