The Difference Between Production Possibilities Frontiers That Are Bowed Out

question 209

Multiple Choice

The difference between production possibilities frontiers that are bowed out and those that are straight lines is that

• A)bowed-out production possibilities frontiers apply to economies that face tradeoffs, whereas straight-line production possibilities frontiers apply to economies that do not face tradeoffs.
• B)bowed-out production possibilities frontiers apply to economies in which resources are not specialized, whereas straight-line production possibilities frontiers apply to economies in which resources are specialized.
• C)bowed-out production possibilities frontiers illustrate increasing opportunity cost, whereas straight-line production possibilities frontiers illustrate constant opportunity cost.
• D)straight-line production possibilities frontiers illustrate real-world conditions, whereas bowed-out production possibilities frontiers illustrate more simplistic assumptions.

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Definitions:

Liabilities

Financial obligations or debts that an entity owes to external parties, which must be settled through the transfer of assets, provision of services, or other economic benefits.

Assets

Resources owned or controlled by a business, expected to produce economic value or future benefits.

Dividends

Payments made by a corporation to its shareholder members, often derived from the company's profits.

Partial Equity Method

An accounting method used when an investing entity holds significant influence but not full control over an investee, and recognizes its share of profits or losses.