Refer to the Diagram Below

question 71

Multiple Choice

Refer to the diagram below. A shift in the production possibilities curve from AB to CD is most likely due to:

• A) the use of the economy's resources in an efficient way.
• B) an increase in the spending of business and consumers.
• C) an increase in government purchase of the economy's output.
• D) an increase in the quantity and quality of labour resources.

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Definitions:

Unrealized Receivables

Amounts owed to a business for goods or services delivered but not yet paid for, which have not been recognized as income.

Ordinary Income

Income earned from normal business operations or employment, subject to regular income tax rates, excluding capital gains or dividends.

Service Partner

A business entity or individual that provides services to another company under a partnership or contractual agreement.

FMV

Fair Market Value, the estimated price at which an asset would change hands between a willing buyer and seller, both having reasonable knowledge and not under compulsion.