Which of the Following Illustrates the Principle of Free Riding

question 137

Multiple Choice

Which of the following illustrates the principle of free riding?

• A) a real estate agent who is consistently late to appointments
• B) a student who uses scholarship money to pay all college tuition and fees
• C) a member of a club who refuses to do fund-raising for club activities
• D) Each of these is an example of free riding.

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Definitions:

Net Sales

The amount of revenue generated from goods or services sold after deducting returns, allowances for damaged or missing goods, and discounts.

Days In Inventory

A financial ratio that indicates the average number of days a company holds inventory before selling it.

Inventory Turnover

A financial metric that measures the number of times a company sells and replaces its stock of goods during a particular period.

Financial Statements

Official records that detail the financial activities and position of a business, individual, or other entity.