Answer the Question on the Basis of the Accompanying Production $\quad$

question 222

Multiple Choice

Answer the question on the basis of the accompanying production possibilities tables for two countries, Latalia and Trombonia. $\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\text { Latalia's production possibilities }$
$\begin{array}{c|c|c|c|c|c} & \text { A } & \text { B } & \text { C } & \text { D } & \text { E } \\\hline \text { Pork (Tons) } & 4 & 3 & 2 & 1 & 0 \\\hline \text { Beans (Tons) } & 0 & 5 & 10 & 15 & 20\end{array}$ $\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\text { Trombonia's production }$
$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\text { possibilities }$
$\begin{array}{c|c|c|c|c|c}\hline & \text { A } & \text { B } & \text { C } & \text { D } & \text { E } \\\hline \text { Pork (Tons) } & 8 & 6 & 4 & 2 & 0 \\\hline \text { Beans (Tons) } & 0 & 6 & 12 & 18 & 24 \\\hline\end{array}$ If these two nations specialize on the basis of comparative advantage,

• A) Trombonia will produce beans and Latalia will produce pork.
• B) Trombonia will produce both beans and pork.
• C) Latalia will produce both beans and pork, and Trombonia will produce neither.
• D) Latalia will produce beans, and Trombonia will produce pork.

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Definitions:

Disbursement Basis

An accounting method in which expenditures and revenues are recorded when cash is actually disbursed or received, rather than when they are incurred.

Accrual Basis

An accounting method where income and expenses are recorded when they are earned or incurred, regardless of when the cash transaction happens.

GAAP Constraint

Guidelines that restrict or limit certain accounting practices under Generally Accepted Accounting Principles, to ensure fairness, consistency, and accuracy in financial reporting.

Disbursement Basis

Accounting method where expenses are recorded when cash is paid out, rather than when incurred.