Refer to Scenario 1

question 205

Multiple Choice

Refer to Scenario 1.2 below to answer the question(s) that follow.
SCENARIO 1.2: A scientist wants to understand the relationship between automobile emissions and the level of global warming. The scientist collects data on the volume of automobile emissions and the levels of global warming over time. The scientist concludes that a 1% increase in automobile emissions causes a 0.0003% increase in average global temperatures. From this information he concludes that the automobile emissions are harmful to the environment and should be reduced to stop the increase in global temperatures.
-Refer to Scenario 1.2. The statement that an increase in automobile emissions causes an increase in global warming is an example of

• A) an economic theory.
• B) a fallacy.
• C) deductive reasoning.
• D) normative economics.

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Definitions:

Voucher System

A financial control mechanism in accounting where vouchers are created for each transaction, and supporting documents are required for authorization before payment.

Bank Statement

A summary of financial transactions which have occurred over a given period on a bank account held by a person or business with a financial institution.

Deposits

Funds placed into a bank account or with some other entity for safekeeping, which can include money put in savings or checking accounts.

Electronic Funds Transfers

The electronic transfer of money between accounts by consumer electronic systems rather than the exchange of cash, checks, or other paper documents.