The Assertion That "There Is No Free Lunch" Means

question 106

Multiple Choice

The assertion that "There is no free lunch" means:

• A)there are always tradeoffs between economic goals.
• B)all production involves the use of scarce resources and thus the sacrifice of alternative goods.
• C)marginal analysis is not used in economic reasoning.
• D)choices do not need be made if behaviour is rational.

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Definitions:

Sum-Of-The-Years-Digits

A depreciation method that accelerates the rate of depreciation, basing it on a fraction that decreases annually.

Scrap Value

The estimated resale value of an asset at the end of its useful life.

Heavy Equipment

Larger, more specialized pieces of machinery used in construction, mining, and heavy industry, such as bulldozers, cranes, and excavators.

Sum-Of-The-Years-Digits

A depreciation method that results in a more accelerated write-off of assets than the straight-line method, involving adding the digits of the years of an asset's useful life.