Statistical Data Provided by the U

question 8

Multiple Choice

Statistical data provided by the U.S. Department of Transportation shows that the median income of individuals traveling on the nation's bus systems is $18,000 compared to $65,000 for those who normally travel by air. This finding is best explained by which of the following statements?

• A) Persons with high income are more likely to fly because the opportunity cost of their time is generally higher than those with lesser income.
• B) Traditionally, lower income groups prefer slower methods of transportation.
• C) Wealthy individuals own stock in the airlines and, therefore, receive preferential treatment.
• D) Low-income groups are generally located near bus stations; wealthy groups congregate around airports.

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Definitions:

Slopes

In mathematics, it represents the steepness or incline of a line, indicating the rate at which it rises or falls.

Diminishing Marginal Returns

A principle stating that as investment in a particular area increases, the rate of profit from that investment, after a certain point, cannot continue to increase if other inputs remain constant.

Per-worker Production Function

A mathematical representation of the relationship between output per worker and the amount of capital per worker, along with technology.

Capital

Financial assets or the financial value of assets, such as cash and securities, used to fund a business or generate wealth.