A Major Earthquake Occurs in the Central Part of the United

question 202

Multiple Choice

A major earthquake occurs in the central part of the United States.What impact would this have on the nation's production possibilities frontier and why?

• A) It would shift outward because unemployment would be reduced.
• B) Nothing would happen because the nation would still have the same capabilities.
• C) A tradeoff would occur to replace the resources and goods destroyed.
• D) It would shift inward because some of the nation's resources, such as capital and labor, would be destroyed.
• E) It would not shift because people would get to work to replace any capital that was destroyed.

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Definitions:

Accumulated Depreciation

The total depreciation for a fixed asset that has been charged to expense since the asset was acquired.

Gain on Sale

The income generated when an asset is sold at a value higher than its original cost or book value.

Machinery

Heavy and complex machines or equipment used in various industries for manufacturing, construction, or specific tasks requiring mechanical force.

Book Value

The value of an asset as recorded on the balance sheet, calculated by subtracting any associated depreciation or amortization from its original cost.