Firms Regularly Use the Following to Reduce Risk

question 75

Multiple Choice

Firms regularly use the following to reduce risk:
I. Currency options
II. Interest-rate options
III. Commodity options

• A) I only
• B) II only
• C) III only
• D) I, II, and III

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Definitions:

Production Possibilities Frontier

A curve depicting the maximum feasible amounts of two different goods that can be produced with available resources and technology.

Aggregate Supply Curve

A graphical representation showing the total supply of goods and services that firms in an economy are willing and able to produce at different price levels.

Maximum Output Level

The highest quantity of goods or services an economy or enterprise can produce using its current resources and technology.

Cyclical Unemployment

When people are out of work because the economy is operating below the full-employment level. It rises sharply during recessions.