Refer to the Diagram Below

question 96

Multiple Choice

Refer to the diagram below.Points A,B,C,D,and E show:

• A) that the opportunity cost of bicycles increases,while that of computers is constant.
• B) combinations of bicycles and computers which society can produce by using its resources efficiently.
• C) that the opportunity cost of computers increases,while that of bicycles is constant.
• D) that society's demand for computers is greater than its demand for bicycles.

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Definitions:

M. Sims Capital

An account representing the owner’s equity or the funds contributed by and belonging to the owner of a company.

Income Summary

An account used in the closing process that aggregates all income and expense accounts to determine the net profit or loss.

Net Income

The total profit of a business after all expenses and taxes have been deducted from total revenue.

Owner's Capital

The amount of equity a business owner has invested in the business minus any withdrawals made from the business by the owner.