EvaluateSince the Production Possibilities Curve Can Shift Outward Over Time

question 51

Essay

Evaluate.Since the production possibilities curve can shift outward over time, it is possible for an economy to get more of a product without incurring an opportunity cost.

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Definitions:

Revenue and Spending Variance

The difference between the expected (budgeted) and actual amounts of revenue and expenses.

Flexible Budget Performance Report

A financial report that compares actual operating results to budgeted amounts adjusted for actual activity levels.

Activity Variance

The difference between the planned budget of an activity and the actual expenses incurred.

Net Operating Income

The earnings derived from the primary activities of a business before the subtraction of any taxes and interest charges.