-Agnes Can Produce Either 1 Unit of X or 1

question 425

Multiple Choice

-Agnes can produce either 1 unit of X or 1 unit of Y in an hour, while Brenda can produce either 2 units of X or 4 units of Y in an hour. The opportunity cost of producing a unit of Y is

• A) 1 unit of X per unit of Y for Agnes and 2 units of X per unit of Y for Brenda.
• B) 1 unit of X per unit of Y for Agnes and 1/2 unit of X per unit of Y for Brenda.
• C) 1 hour for Agnes and 1/2 hour for Brenda.
• D) 1 hour for Agnes and 2 hours for Brenda.

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Definitions:

Accounts Receivable Period

The average number of days it takes for a business to collect payments from its credit sales, indicating the efficiency of its credit and collection policies.

Cash Balance

A measure of the amount of cash that a company, or an individual, has on hand at any given time.

Short-Term Loan

A loan scheduled to be repaid in less than a year, often used for immediate cash flow needs.

Annual Net Cash Inflow

The total amount of cash that a business generates in a year, after all expenses and taxes are subtracted from total cash inflows.