There Are Two Explanations of Constant Opportunity Costs: (1) Factors

question 149

True/False

There are two explanations of constant opportunity costs: (1) factors of production are imperfect substitutes for each other; (2) all units of a given factor have different qualities.

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Definitions:

Work in Process

Inventory that includes goods that are in the production process but are not yet completed.

Finished Goods

These are completed products that are ready for sale but have not yet been sold to customers.

Cost of Goods Sold

Costs directly incurred in the manufacture of goods a company sells.