Which of the Following Is Most Consistent with Economizing Behavior

question 66

Multiple Choice

Which of the following is most consistent with economizing behavior?

• A) If you derive the same satisfaction from eating pizza and eating ice cream, it makes no difference which one of the two you choose.
• B) Before voting, you should invest the time and energy to become fully informed on all of the issues and candidates.
• C) It never makes sense to hire someone to do something for you that you could do yourself.
• D) If you get the same satisfaction from a chicken sandwich and a salad, you should purchase the one that costs the least.

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Definitions:

Adjusting Entries

Journal entries made at the end of an accounting period to allocate income and expenditures to the period in which they actually occurred.

Estimated Amount

A projection or approximation of a financial figure often used in budgeting or forecasting.

Allowance Method

A method used in accounting to estimate and account for bad debts, representing the amount of accounts receivable that may not be collected.

Allowance for Doubtful Accounts

A contra asset account that represents the estimated portion of accounts receivable that may not be collectible.