If an Economy Is Producing at a Point on Its

question 218

Multiple Choice

If an economy is producing at a point on its production possibilities frontier,it is:

• A)efficient in production and allocation.
• B)efficient in production but not necessarily in allocation.
• C)efficient in allocation but not necessarily in production.
• D)not necessarily efficient in production or allocation.

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Definitions:

Par Value

The face value of a bond or stock as stated by the issuing company, unrelated to its market value.

Transaction Fee

A charge levied for processing a payment or financial transaction.

Shares

Units of ownership interest in a corporation or financial asset that provide for an equal distribution in any profits, if any are declared, in the form of dividends.

Rate of Yield

The percentage of return on an investment, calculated by dividing the income generated by the investment by the cost or current market value of the investment.