Len Is Putting in a New Swimming Pool

question 103

Multiple Choice

Len is putting in a new swimming pool. He can either heat his pool with natural gas or with solar power. If he chooses solar power it will cost him more today, but he will recover these costs over the next 7 years in savings on his natural gas bill. The solar heater is expected to last 12 years. Len:

• A) will put in the solar heater regardless of the discount rate because the savings in natural gas outweigh the initial cost of the solar heater.
• B) is more likely to install the solar heater as the discount rate increases.
• C) is more likely to install the solar heater as the discount rate declines.
• D) will not put in the solar heater unless he is an environmentalist.

Understand the role of contingent reward and punishment behaviors in leadership.

Appreciate the concept of LMX differentiation and its impact on group dynamics and performance.

Identify and classify costs into variable and fixed categories.

Understand the concept of marginal cost and its calculation.

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Definitions:

SuperMart

A large supermarket, often part of a chain, offering a wide variety of goods.

Markdown

A reduction from the original or list price of a good or service to increase its attractiveness to buyers.

Regular Selling Price

the normal price at which a good or service is sold before any discounts or promotions.

High-end Stove

A premium kitchen appliance that offers superior performance, quality, and features compared to standard models.