If an Economy Is Operating at a Point That Is

question 290

Multiple Choice

If an economy is operating at a point that is inside of its production possibilities frontier, then it can be assumed that its resources are

• A) efficiently allocated.
• B) overutilized.
• C) fully utilized.
• D) underutilized.

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Definitions:

Machine Hours

A measure of the amount of time a machine is operated in the production process.

Avoidable Costs

Avoidable Costs are expenses that can be eliminated if a particular decision is made, such as discontinuing a product or service.

Future Costs

Expenses or expenditures that are expected to be incurred in future accounting periods.

Fixed Costs

Regular, constant expenses that a business incurs regardless of the level of goods or services produced.