Ollie South Has an Endowment of 10 Guns and 10

question 29

Multiple Choice

Ollie South has an endowment of 10 guns and 10 pounds of butter.He can buy or sell butter at $1 a pound.But the world market for guns is more complicated: he can buy guns for $5 each, but he can sell guns for only $2.If we graph his budget line with guns on the horizontal axis and butter on the vertical axis, then Ollie's budget line is a straight line

• A)joining (12, 0)and (0, 30).
• B)joining (14, 0)and (0, 14).
• C)with slope - 2/5 through the point (10, 10).
• D)with slope - 5/2 going through the point (10, 10).
• E)None of the above.

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Definitions:

Earnings Restatements

The act of amending previously reported financial statements to correct errors.

Dividends

Payments made by a corporation to its shareholders, usually in the form of cash or additional shares, from its profits.

Depreciation

This is the systematic allocation of the cost of a tangible asset over its useful life. It reflects the consumption of the asset over time.

Tax Bill

A tax bill is an official statement from a governmental authority specifying the amount of taxes owed by an individual or organization for a certain period.