Bill Is Restoring a Car and Has Already Spent $4000

question 19

Multiple Choice

Bill is restoring a car and has already spent $4000 on the restoration.He expects to be able to sell the car for $6200.Bill discovers that he needs to do an additional $2400 of work to make the car worth $6200 to potential buyers.He could also sell the car now,without completing the additional work,for $3800.What should he do?

• A)He should sell the car now for $3800.
• B)He should keep the car since it wouldn't be rational to spend $6400 restoring a car and then sell it for only $6200.
• C)He should complete the additional work and sell the car for $6200.
• D)It does not matter if Bill sells the car now or completes the work and then sells it at the higher price because the outcome will be the same either way.

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Definitions:

Commonly Used

Frequently utilized or employed in general practice.

Tenants by the Entirety

A form of joint property ownership specifically designed for married couples where both spouses have equal and undivided interest in the property.

Property Ownership

The legal right to possess, control, benefit from, and transfer real estate or personal property.

Heir

A person legally entitled to receive part of the estate of a deceased person, either by will or through intestate succession laws.