What Is Planned Obsolescence

question 43

Multiple Choice

What is planned obsolescence?

• A) intentional design of goods to ensure a product is long-lasting
• B) the cycling of products to ensure that consumers are always wanting something new
• C) the design of products to ensure that they meet the needs of many consumers
• D) intentional design of goods to ensure a loss of utility in a short period of time

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Definitions:

After-Tax Net

The remaining income of a business or investment after all taxes have been deducted.

Unlevered Cost

Refers to the cost a company would incur without the benefit or cost of debt financing.

Capital Structure

The mix of a company's long-term debt, specific short-term debt, common equity and preferred equity, which is used to finance its overall operations and growth.

Economic Expansion

A phase of the business cycle where the economy grows and increases in activity, marked by rising GDP, employment, and income.