INSTRUCTIONS: Choose the Word or Phrase in [ ] Which

question 92

Multiple Choice

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.
-You use a small building on your property to manufacture Widgets.This building [will | will not] be covered by your standard HO policy.

• A)for the first item
• B)for the second item
• C)if neither item will correctly complete the statement.

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Definitions:

Opportunity Costs

The expense incurred from not selecting the subsequent preferable choice when a decision is made.

Comparative Advantage

The ability of a country or entity to produce a good or service at a lower opportunity cost than others, enabling trade benefits.

Production

A process that transforms resources into goods and services.

Absolute Advantage

The ability of a country, company, or individual to produce a good or service more efficiently than competitors using the same amount of resources.