Answer the following questions true (T) or false (F)
1. A decrease in liabilities will reduce a firm's accounting profit.
2. Economic profit is the difference between a firm's revenue and its opportunity costs.
3. An increase in liabilities will reduce a firm's net worth.
1. FALSE
2. TRUE
3. TRUE
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Opportunity cost is illustrated in a production possibilities frontier (PPF) by a movement
A) from the region within the PPF to a point on the PPF. B) from the region within the PPF to the region outside of the PPF. C) from the region outside of the PPF to a point on the PPF. D) along the PPF where to gain more of one good it is necessary to give some of another good.
On a diagram of a production possibilities frontier, opportunity cost is represented by the production possibilities frontier shifting outward
Indicate whether the statement is true or false