Josh Has an IPhone, and He Frequently Downloads Songs from the ITunes

question 35

Multiple Choice

Josh has an iPhone, and he frequently downloads songs from the iTunes website. He pays a small fee for each download, but downloading a song does not remove it from the iTunes inventory. Other consumers can also pay the fee and download a song that Josh might have already accessed. The iTunes service is best described as(n) :

• A) private good.
• B) public good.
• C) artificially scarce good.
• D) common resource.

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Definitions:

Tax Rate

The rate at which taxes are levied on an individual or a company's income.

Equity Method

An accounting technique used to record investments in other companies, where the investment is significant but does not result in full control or majority ownership, typically 20% to 50% of the investee's voting stock.

Cost Method

An accounting method used to value an investment at its original purchase cost, adjusted for dividends, stock splits, and stock dividends.

Intercompany Interest Revenues

Income earned by one entity within a corporate group for lending funds to another entity within the same group, typically eliminated during the consolidation process for financial reporting.