Figure 6-2 Shows an Edgeworth Box with the Preferences of Kathy

question 32

Multiple Choice

Figure 6-2 shows an Edgeworth box with the preferences of Kathy and Tom toward bread and candy.
Figure 6-2
-Refer to the Edgeworth box in Figure 6-2.Which of the following statements is true?

• A)Point A is more efficient than point E.
• B)Point E is more efficient than point C.
• C)Point C is more efficient than point B.
• D)Point B is more efficient than point A.

---

Definitions:

Indifferent

Having no particular interest or concern; not inclined toward one view, position, or outcome over another.

Direct Fixed Expenses

Costs that are directly associated with a specific department or segment of a business and do not vary with the level of production or sales.

Cash Flow

The aggregate money movement into and out of a company, notably impacting its cash on hand.

Excess Capacity

The availability of more production capacity within a business than is currently needed to meet demand.