Use the Following to Answer Questions

question 263

Multiple Choice

Use the following to answer questions:
-(Figure: Production Possibilities and Circular-Flow Diagram) Use Figure: Production Possibilities and Circular-Flow Diagram.Assume the two figures represent the same economy.Suppose that in the circular-flow diagram there is a significant decrease in the amount of labour flowing to the firms that produce coconuts.If all other variables remain unchanged,this adjustment in the economy would be BEST represented in the production possibilities figure by a move from point A toward:

• A) point A (no movement).
• B) point B (a decrease in coconut production and an increase in fish production).
• C) point C (a decrease in coconut production).
• D) point D (an outward shift of the entire curve).

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Definitions:

Actual Cost

The actual expenses and costs incurred in acquiring or producing a product or offering a service.

Accounts Payable

Accounts payable is the amount of short-term debt or money owed to suppliers and creditors by a company for goods and services purchased on credit.

Accounts Receivable

The funds that a company is entitled to collect from its customers for goods provided or services rendered but not yet paid.

Equipment

Tangible property used in operations, which is not intended for sale, often with a useful life exceeding one year and subject to depreciation.