If the Production Possibilities Frontier Between Two Goods Is a Straight

question 217

Multiple Choice

If the production possibilities frontier between two goods is a straight line,then the

• A) opportunity cost is not a ratio.
• B) resources are equally productive in both goods.
• C) line does not qualify as a production possibilities frontier because the unattainable production points are too close to the inefficient production points.
• D) Both answers A and C are correct.
• E) Both answers A and B are correct.

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Definitions:

In The Money

Describes an option with an intrinsic value where a call option's strike price is below the market price of the underlying asset or a put option's strike price is above.

Time Value

The additional amount an investor is willing to pay for an option above its intrinsic value, based on the time remaining until its expiration.

Put Option

A financial contract that gives the holder the right, but not the obligation, to sell a specified amount of an underlying asset at a set price within a specified timeframe.

In-The-Money

A term used in options trading to describe an option that has intrinsic value, where the strike price is favorable compared to the current market price of the underlying asset.