According to the Hotelling Principle, the Price of an Nonrenewable

question 96

Multiple Choice

According to the Hotelling Principle, the price of an nonrenewable resource

• A) falls slowly over time.
• B) falls at a rate equal to the interest rate.
• C) rises at a rate equal to the interest rate.
• D) remains constant over time.

---

Definitions:

Straight-Line Method

A method of calculating depreciation and amortization, dividing the difference between an asset's cost and its salvage value by the number of years it is expected to be used.

Straight-Line Depreciation

A method of allocating the cost of a tangible asset over its useful life in equal annual amounts.

Net Income Attributable

The portion of net income (profit) that is available to the shareholders, after accounting for dividends to preferred stockholders and other adjustments.

Noncontrolling Interest

A stake in a company that is less than 50%, implying that the holder does not have control over the company's operations.