If France Is Capable of Producing Either Cheese or Wine

question 39

Multiple Choice

If France is capable of producing either cheese or wine or some combination of those two products,then:

• A)France should produce the one it is more efficient at producing.
• B)France should produce the one for which it has a lower opportunity cost.
• C)France should produce the one for which is has a higher opportunity cost.
• D)France should remain self-sufficient if it has the absolute advantage in the production of both.

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Definitions:

Capital Balance

Represents the amount of funds contributed by investors or owners plus retained earnings in a company.

SEC

The U.S. Securities and Exchange Commission, a federal agency responsible for enforcing federal securities laws and regulating the securities industry.

Bonus

An additional payment or reward given to employees as an incentive or reward for performance.

Partnership

A form of business organization where two or more individuals agree to share the profits and losses of a business venture.