Using Graphs to Illustrate the Concepts, Absolute Advantage

question 187

Multiple Choice

Using graphs to illustrate the concepts, absolute advantage

• A)is shown with differences in slope of a production possibilities curve; comparative advantage is shown with a lower curve.
• B)requires a very steep curve; comparative advantage requires a curve with a shallow slope.
• C)on one good requires that the slope of the production possibilities curve be steeper for that good.
• D)is shown with a higher production possibilities curve; comparative advantage is shown with differences in slope of the curves.

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Definitions:

Unsubscribed Portion

That part of a new issue of securities not taken up or purchased by investors during an offering period.

Ex-Rights Date

The first trading day when a security is offered for sale in the marketplace without the entitlement to a previously declared rights offering.

Rights Offering

An option for existing shareholders to buy additional shares directly from the company at a pre-determined price, usually at a discount, as a way to raise capital.

Value of a Right

The theoretical value of a subscription right, which allows existing shareholders to purchase additional shares at a discount before the new shares are offered to the public.