Kim Moved from One House in a Neighborhood to Another

question 29

Multiple Choice

Kim moved from one house in a neighborhood to another house in a nearby neighborhood. She called her trash collection company to inform them of her address change and was dismayed to learn that her trash collection bill will be $10 a month higher than it was at her previous residence even though it is the same company. She commented on this and was told by the lady from the company that was the price and she can deal with removing her own trash if she didn't like the price hike. Kim just had to pay the higher price because there was no other company allowed to service this neighborhood. What is the best reason why Kim was treated so poorly by this company?

• A) the trash company was dependent on her repeat business
• B) there are no other competitors providing this service
• C) it is a regulated service
• D) Kim preferred this company over any others
• E) the company really doesn't need her business

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Definitions:

Debt Securities

Financial tools that signify an investor lending money to a borrower, commonly consisting of bonds, notes, and bills.

Speculative Reasons

Motivations based on speculation where actions are taken with the expectation of future financial gains or losses.

Equity Method Investments

Investments in which the investor has significant influence over, but not full control or ownership of, another company, requiring recognition of its share of the investee's profits or losses.

Marketable Stock Securities

Financial instruments that represent ownership in companies or rights to ownership, easily bought and sold in public markets.