If a Production Possibilities Frontier Intersects an Isorevenue Line at Two

question 5

Multiple Choice

If a Production Possibilities Frontier intersects an isorevenue line at two points, then:

• A) there are two choices of maximum revenue output combinations
• B) profits could be higher on a higher isorevenue line
• C) there is a lower isorevenue line where the PPF will intersect at only one point
• D) no maximum revenue combination is possible

---

Definitions:

Investing Activities

Investing activities are financial transactions related to the acquisition or disposal of long-term assets and other investments not considered cash equivalents, as detailed in the statement of cash flows.

Financing Activities

Activities that result in changes in the size and composition of the equity capital or borrowings of the company, as reported in the statement of cash flows.

Accounts Payable

A company's financial liability to its suppliers or creditors for received goods and services.

Accounts Receivable

Accounts Receivable are amounts owed to a business by its customers from sales or services provided on credit.