Figure 2.1. Production Possibilities Frontier

question 131

Multiple Choice

Figure 2.1. Production Possibilities Frontier
-Referring to Figure 2.1, the relative cost of steel in terms of aluminum is

• A) 4.0 tons.
• B) 2.0 tons.
• C) 0.5 tons.
• D) 0.25 tons.

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Definitions:

Average Rate

A calculation to find the central or typical value of a set of rates or amounts.

Profitability

The ability of a firm to earn income.

Cash Inflows

Money or other assets that come into a company or economy, often from sales, investments, financing, and other sources.

Cash Payback Period

The duration required for an investment to generate cash flows sufficient to recover the initial outlay or cost.