Consider an Electric Utility That May Use Either Coal or Natural

question 47

Multiple Choice

Consider an electric utility that may use either coal or natural gas to generate electricity. Under which of the following conditions is co-firing equipment least valuable? Let a_c be the annual standard deviation of coal prices, and let a_n be the annual standard deviation of natural gas prices and p the correlation between coal prices and natural gas prices.

• A)a_c high, a_n high, p low
• B)a_c high, a_n low, p low
• C)a_c low, a_n high, p low
• D)a_c low, a_n low, p high

---

Definitions:

Tight Labour Market

Economic conditions characterized by low unemployment rates and high demand for workers, often leading to increased wages and a competitive environment for hiring.

Labour Supply

The total hours that workers are willing and able to work at a given wage rate.

Engineering School Graduates

Engineering school graduates refer to individuals who have successfully completed an engineering program at a college, university, or technical school.

Job Sharing Arrangements

A work structure where two or more individuals share the responsibilities and duties of a single full-time job.