A Gas Station That Does Not Offer Pay at the Pump

question 70

Multiple Choice

A gas station that does not offer pay at the pump service decides to require drivers to prepay for gas to decrease the amount of drive-offs. Which of the following could be an opportunity cost of this decision?

• A) The value of the gas that is no longer stolen by people who drove off
• B) The time saved from not having to look for people waiting for you to turn on the pump
• C) Lost revenue from people who underestimate how much their gas tank can hold so they don't end up overpaying
• D) A loss of snack sales due to people paying for gas before pumping rather than after pumping

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Definitions:

Regressive

Describes a tax structure where the tax rate decreases as the taxable amount increases, placing a higher relative burden on lower income earners.

Effective Average

A calculated mean intended to provide a more accurate or meaningful representation of a set of values, taking into account various factors.

Federal Taxes

Taxes collected by the national government, including income taxes and Social Security taxes.

Perfectly Elastic

Describes a situation where the quantity demanded or supplied responds infinitely or massively at a particular price level, often represented by a horizontal line on a graph.