Opening Trade Between Two Nations Would

question 108

Multiple Choice

Opening trade between two nations would

• A) shift their production possibilities curves outward.
• B) shift their production possibilities curves inward.
• C) leave the production possibilities unchanged and increase their consumption possibilities.
• D) leave the production possibilities unchanged and decreased their consumption possibilities.

---

Definitions:

Net Present Value

Net Present Value (NPV) is a financial metric that calculates the value of a series of cash flows over time, discounted back to their present value to assess an investment's profitability.

Desired Rate of Return

The minimum return a company or investor expects to achieve on an investment, often used in capital budgeting to evaluate potential projects.

Future Cash Flows

The projected inflows and outflows of cash over a specific future period, vital for financial planning and valuing investments.

Capital Investment Analysis

Capital investment analysis is the process of evaluating the potential returns of an investment in fixed assets, considering factors such as cost, life expectancy, and the benefits it will provide.