A Homeowner Has a New Oil Furnace Which Has an Efficiency

question 13

Multiple Choice

A homeowner has a new oil furnace which has an efficiency of 60%. For every 100 barrels of oil needed to heat his house, how much (in barrels of oil) goes up the chimney as waste heat?

• A) 20
• B) 60
• C) 40
• D) 80
• E) 10

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Definitions:

Operating Expenses

Costs associated with a company's operations, such as sales and marketing, administration, and rent.

Capital Budgeting

The process of planning and evaluating expenditures on assets whose cash flows are expected to extend beyond one year, such as new machinery or building expansions.

Incremental Sales

Additional sales generated by a new business activity, such as a marketing campaign or product launch, beyond what would have been sold without it.

Operating Expenses

Costs associated with running a business that are not directly linked to the production of goods or services, including rent, utilities, and administrative salaries.