When Making a Choice to Do More of One Activity

question 108

Multiple Choice

When making a choice to do more of one activity, the highest-valued other choice society does not make is called _______ , and it is measured _______ .

• A) opportunity cost; in terms of the money it costs
• B) increasing cost; in terms of the amount of money spent doing so
• C) constant cost; by the slope of the production possibilities curve at that level
• D) opportunity cost; by the slope of the production possibilities curve at that level

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Definitions:

Futures

Standardized contracts to buy or sell a specific asset at a predetermined price at a specified future date, used for hedging or speculation.

Forwards

A contract between two parties to buy or sell an asset at a specified price on a future date.

Swaps

Agreements to exchange two securities or currencies.

Profiling An Option

This term is not widely recognized in standard financial terminology. NO.