If Allocating Dorm Rooms Changes from Allocation by Lottery to Allocation

question 72

Multiple Choice

If allocating dorm rooms changes from allocation by lottery to allocation by the market:

• A) it becomes an economic problem.
• B) it becomes a political problem but not an economic problem.
• C) it becomes a social problem but not an economic problem.
• D) the allocation problem is still an economic problem.

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Definitions:

Discount Rate

The interest rate used in discounted cash flow analysis to determine the present value of future cash flows.

Cash-Generating Unit

The minimal distinguishable collection of assets that creates cash inflows primarily independent from the cash inflows of other assets or asset collections.

Impairment Loss

The amount by which the carrying amount of an asset or a cash-generating unit exceeds its recoverable amount.

Net Carrying Amount

The value of an asset recorded in a company's financial statement, which is the original cost minus accumulated depreciation and impairment losses.