If Al Has an Absolute Advantage Over Beth in Preparing

question 69

Multiple Choice

If Al has an absolute advantage over Beth in preparing meals, then:

• A)it takes Al more time to prepare a meal than Beth.
• B)the problem of scarcity applies to Beth but not to Al.
• C)Al's opportunity cost of preparing a meal is lower than is Beth's.
• D)Al can prepare more meals in a given time period than Beth.

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Definitions:

Inventory Loans

Short-term loans or lines of credit secured by a company’s inventory, used to purchase products for sale.

Factoring Accounts Receivable

A financial transaction where a business sells its accounts receivable to a third party at a discount to immediately raise cash.

Commercial Paper

An unsecured, short-term debt instrument used by corporations to finance their immediate needs.

Accounts Payable

Obligations or debts that a company owes to its suppliers or creditors for goods or services received that have not yet been paid for.