When a Highly Valued Resource Cannot Be Easily Traded, as Is

question 18

Multiple Choice

When a highly valued resource cannot be easily traded, as is often true with water flowing in a river, then

• A) it will not be hoarded by the rich, but will be available to all on an equal basis.
• B) we can expect shortages from time to time, and conflicts over access to its use.
• C) its price will be low as a result.
• D) markets in the resource will clear more easily, without greed and profit to get in the way.

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Definitions:

Straight-Line Method

A depreciation technique that allocates an equal amount of depreciation expense for an asset over its useful life.

General Journal Entry

A record in the general journal that includes all the financial transactions of a company, showing accounts affected, amounts, and whether those amounts are debits or credits.

Amortizing

The process of gradually paying off a debt over time through regular payments.

Straight-Line Method

A method of calculating depreciation by evenly distributing the cost of an asset over its useful life.