The Production Possibilities Frontier Illustrates

question 124

Multiple Choice

The production possibilities frontier illustrates

• A) the combinations of goods that could be produced with resources and technology constant
• B) how technology influences opportunity costs
• C) the law of diminishing returns
• D) how price changes affect decision making of individuals
• E) the law of demand

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Definitions:

Inventory

Assets held for sale in the ordinary course of business, as well as materials and supplies used in producing goods available for sale.

Chart of Accounts

The Chart of Accounts is an organized list of all accounts in the general ledger of a company, used for recording transactions and building financial statements, categorized by assets, liabilities, equity, revenues, and expenses.

Merchandising Business

A type of business that purchases finished products and sells them to consumers, making a profit from the markup.

Service Business

A company that provides intangible products, such as expertise or labor, rather than physical goods.