If Parking Spaces on a College Campus Are Scarce, with Quantity

question 218

Multiple Choice

If parking spaces on a college campus are scarce, with quantity demanded during the "peak" hours, from 8 a.m.to 11 a.m., far greater than the number of spaces, an economist would propose as an efficient solution,

• A) lowering the parking fees during those hours to compensate students for the longer search time.
• B) charging the same parking fees during all hours of the school day.
• C) raising parking fees during the peak hours to encourage some students to schedule classes during other hours when parking fees are lower.
• D) hiring more security guards to patrol for illegal parkers.

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Definitions:

Profitability Ratios

Measures of a company’s overall financial performance by evaluating its ability to generate revenues in excess of expenses.

Inventory Turnover

Inventory turnover is a ratio showing how many times a company's inventory is sold and replaced over a specific period, indicating the efficiency of inventory management.

Return on Equity

A measure of the profitability of a business in relation to the equity, calculated as net income divided by shareholders' equity, expressing the company's ability to generate profits from its shareholders' investments.

Net Profit Margin

It is a financial metric that indicates how efficient a company is at generating profit compared to its revenue, expressed as a percentage.