Identify the Truthfulness of the Following Statements

question 49

Multiple Choice

Identify the truthfulness of the following statements. I. Ordinal utility gives us information about which basket the consumer prefers and quantitative information about the intensity of the preference.
II) Cardinal utility gives us information about which basket the consumer prefers but not about the intensity of those preferences.

• A) Both I and II are true.
• B) Both I and II are false.
• C) I is true; II is false.
• D) I is false; II is true.

---

Definitions:

Annuity Due

An annuity where payments are made at the beginning of each period instead of the end.

Bargain Purchase Option

An option given to the lessee to purchase the leased asset at the end of the lease term at a price significantly lower than the expected fair market value.

Future Rents

Future rents refer to the payments that are expected to be received in the future for the use of an asset, typically real estate.

Unreimbursable Costs

Expenses that cannot be recovered or compensated for by any means.