You Purchase Both Potatoes and Gasoline Regularly

question 37

Multiple Choice

You purchase both potatoes and gasoline regularly.Your income increases and you purchase more gasoline and less potatoes.This implies that

• A)gasoline has a negative substitution effect.
• B)potatoes are normal goods.
• C)gasoline is an inferior good.
• D)gasoline is a normal good.

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Definitions:

Control Premium

An additional amount paid over the fair market value of a company to acquire a controlling interest in it.

Full Goodwill Method

An accounting approach where goodwill is calculated as the difference between the purchase price and the fair value of the identifiable net assets of the acquired entity, including the non-controlling interest's share of the net assets.

Control Premium

The additional amount willing to be paid over the fair market value of a company's shares, reflecting the value of obtaining control of the company.