Inefficient Allocation of Resources Occurs When

question 207

Multiple Choice

Inefficient allocation of resources occurs when

• A)no one can be made better off without having someone else give up something.
• B)it is possible to make some people better off without making others worse off.
• C)society is operating at a point high on the production possibilities frontier.
• D)society is operating at a point low on the production possibilities frontier.

---

Definitions:

Gross Profit Method

An inventory estimation technique that calculates the cost of goods sold by deducting sales revenue from the gross profit percentage.

Net Realizable Value

The estimated selling price of goods, minus the costs of their sale or disposal, used to assess the value of inventory or receivables.

Retail Inventory Method

An accounting method used to estimate the ending inventory and cost of goods sold of a retail company by using a cost-to-retail price ratio.

Days' Sales in Inventory

An economic indicator that calculates the mean duration in days a business requires to sell off its stock.