Scott and Cindy Both Produce Only Pizza and Tacos

question 20

Multiple Choice

Scott and Cindy both produce only pizza and tacos. In one hour, Scott can produce 20 pizzas or 40 tacos. In one hour, Cindy can produce 30 pizzas or 40 tacos. Scott's opportunity cost of producing 1 taco is

• A) 20 pizzas.
• B) 1/2 of a pizza.
• C) 2 tacos.
• D) 1 pizza.
• E) 2 pizzas.

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Definitions:

Adjusting Journal Entry

An entry in accounting that is made at the end of an accounting period to record any unrecognized income or expense for the period.

Income Tax Expense

The cost incurred by businesses or individuals due to earnings, represented as an expense in financial statements and affecting net income.

Retained Earnings

The portion of net income that is not distributed to shareholders as dividends but is kept by the company for reinvestment.