Figure 2-3 Shows the Production Possibilities Curve of an Economy

question 93

Multiple Choice

Figure 2-3 shows the production possibilities curve of an economy in the production of food and clothing. If the economy operates at Point A on the production possibilities curve shown above, then:Figure 2-3

• A)it cannot increase its output of food.
• B)it cannot increase its output of clothing.
• C)it cannot simultaneously increase its output of both food and clothing.
• D)it is not utilizing its resources inefficiently.
• E)it cannot decrease its output of food.

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Definitions:

Chronologically

In order of time, from the earliest to the latest.

Unearned Revenues

Money received by a company for services or goods yet to be provided or delivered, recorded as a liability.

Revenues

Inflows of assets or settlements of liabilities from the company's primary operations, typically from sales of goods or services.

Debits

Accounting entries that increase assets or expenses or decrease liabilities, equity, and revenue.