Despite Specialization and Comparative Advantage, Household Production Still Exists Because

question 72

Multiple Choice

Despite specialization and comparative advantage, household production still exists because for some households

• A)the opportunity cost of production at home is greater than the cost of purchasing the good in the market
• B)production at home is less costly than purchasing the good in the market
• C)the value of home production exceeds the sunk cost of home production
• D)the value of home production is ignored
• E)food and clothing expenditures represent a small portion of their total budget

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Definitions:

90-Day Note

A short-term debt security that matures in 90 days, typically used in the financing of inventory, accounts receivable, or other short-term needs.

Note Receivable

Note Receivable is a financial asset representing a written promise to receive a specific amount of money from another party on a determined future date or dates.

Credit Sales

Sales transactions where the payment is delayed as per agreed terms between the seller and the buyer.

Retail Store Credit Card

A credit card issued by a retail store allowing customers to purchase goods on credit from that specific retailer.