An Economist Would Say the Price Is Too High for a Certain

question 86

Multiple Choice

An economist would say the price is too high for a certain service if

• A)poor people couldn't afford to buy it.
• B)nobody could afford to buy it.
• C)the price was above marginal cost.
• D)it is an essential service and consumes a significant share of income.

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Definitions:

Depreciation Expense

The systematic allocation of the cost of a tangible asset over its useful life, reflecting its usage and wear and tear.

Direct Financing Leases

A type of lease where the lessor accounts for the asset as a receivable at an amount equal to the net investment in the lease.

Sales-Type Leases

Leases where the lessor recognizes immediate profit on the sale, in addition to interest revenue over the lease term, similar to a financial purchase.