A Production Possibilities Curve Shows

question 23

Multiple Choice

A production possibilities curve shows

• A)what happens to the amount of available resources if it is not possible to produce a good.
• B)what can be produced with unlimited resources.
• C)what happens as available resources in an economy are moved from producing one type of good to another type, or vice versa.
• D)the choice between producing some goods versus other goods with unlimited resources.
• E)the different kinds of products that a firm can produce.

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Definitions:

Discount Rate

The interest rate used to discount future cash flows to their present value, enabling comparison of the value of investments made at different times.

Net Present Value

A method used to evaluate investments by calculating the present value of expected future cash flows minus the initial investment cost.

Cash Inflows

Refers to the money received by a company during a particular period, including revenues from sales, investments, and financing activities.

Minimum Acceptable Rate

The lowest rate of return on an investment that a manager or investor is willing to accept.