An Efficient Allocation of Resources Exists If

question 205

Multiple Choice

An efficient allocation of resources exists if

• A)one group of people can get more of the things they want without someone else having to give up anything.
• B)no one can get more of the things he wants without someone else having to give up something.
• C)the economy operates at any point under the production possibilities frontier.
• D)the economy is operating at any point above the production possibilities frontier.

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Definitions:

Accelerated Depreciation

A method of depreciation in which an asset loses value faster in the initial years of its useful life, with decreased amounts in later years.

Net Present Value

A method of evaluating investments by calculating the present value of future cash flows minus the initial investment cost, used to assess the profitability of an investment.

Cash Inflows

Money received by a business from its operational, investment, and financing activities.

Internal Rate

Often related to the internal rate of return (IRR), it's a metric used in financial analysis to estimate the profitability of potential investments.