After a Natural Disaster, Such as a Hurricane, the Increased

question 133

Multiple Choice

After a natural disaster, such as a hurricane, the increased demand for certain items (like lumber, electric generators, and chainsaws) causes their prices to rise. These higher prices

• A) discourage the flow of these items into the area.
• B) encourage consumers to purchase the items even if they do not plan to use them.
• C) help to direct the items toward their highest valued uses.
• D) do all of the above.

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Definitions:

Lease

An agreed contract in which the lessor permits the lessee to utilize an asset for a set duration in return for regular payments.

Tax-Oriented Lease

A financial lease in which the lessor is the owner for tax purposes. Also called a true lease or a tax lease.

Lessor

The party who rents or leases a property or asset to another party, known as the lessee.

Financial Lease

A lease agreement where the lessee assumes most of the risks and rewards of ownership, often with an option to purchase the asset at the end of the lease term.