If He Devotes All of His Available Resources to Cantaloupe

question 105

Multiple Choice

If he devotes all of his available resources to cantaloupe production,a farmer can produce 120 cantaloupes.If he sacrifices 1.5 watermelons for each cantaloupe that he produces,it follows that

• A)if he devotes all of his available resources to watermelon production,then he can produce 80 watermelons.
• B)he cannot have a comparative advantage over other farmers in producing cantaloupes.
• C)his opportunity cost of one watermelon is 2/3 of a cantaloupe.
• D)his production possibilities frontier is bowed-out.

---

Definitions:

Adjusted Trial Balance

A financial statement that lists all accounts of a company and their balances after adjustments have been made.

Adjusting Entries

Journal entries made in accounting to update the records for revenues and expenses that have accrued but not yet been recorded through standard accounting transactions.

Prepaid Expenses

Costs paid in advance of their use, such as insurance or rent, which are recorded as assets on a balance sheet until they are actually incurred.

Recorded

The process of documenting financial transactions in the accounting records of a business.