Refer to the Information Provided in Figure 4

question 20

Multiple Choice

Refer to the information provided in Figure 4.1 below to answer the question(s) that follow. Figure 4.1
-Refer to Figure 4.1. Assume that initially there is free trade. If the United States then imposes a 10-cent tax per apple,

• A) the quantity of apples demanded will be reduced by 4 million apples per day.
• B) the quantity of apples supplied by U.S. firms will increase by 6 million apples per day.
• C) the price of apples in the United States will increase to 40 cents per apple.
• D) U.S. imports of apples will increase by 6 million per day.

Recognize the role of similarity in arguments by analogy.

Assess how specific similarities or differences affect the strength of analogical arguments.

Understand the inductive generalizations implied by arguments by analogy.

Identify possible fallacies in arguments by analogy.

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Definitions:

Net Present Value

A method used in capital budgeting to evaluate the profitability of an investment or project by calculating the difference between the present value of cash inflows and outflows.

Cost Recovery

The process of recuperating the expenses incurred on an asset through depreciation deductions or when the asset is sold.

Profitability Index

A financial metric that measures the relative profitability of an investment by dividing the present value of future cash flows by the initial investment cost.

Present Value

Present value is the current worth of a future sum of money or stream of cash flows given a specified rate of return.