Identify the Truthfulness of the Following Statements

question 32

Multiple Choice

Identify the truthfulness of the following statements.
I. A firm decides to purchase a computer for $1,500 at the end of the month. The computer will be used for administrative purposes that do not vary with the volume of product that the firm makes. The computer has no re-sale value. This is a fixed cost. At the beginning of the month, this cost is non-sunk.
II. A firm decides to purchase a computer for $1,500 at the beginning of the month. The computer will be used for administrative purposes that do not vary with the volume of product that the firm makes. The computer has no re-sale value. This is a fixed cost. At the end of the month, this cost is sunk.

• 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.

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Definitions:

Nurture

The influence of external factors after conception, e.g., the product of exposure, experience, and learning on an individual.

Instinct

An ingrained behavior observed in animals that consistently occurs in reaction to designated stimuli.

Drive-Reduction Theory

A psychological theory suggesting that motivation arises from biological needs driving an individual to act in ways that reduce drives and achieve homeostasis.

Physiological Needs

The most basic human necessities required to sustain life, such as air, water, food, shelter, and sleep, according to Maslow's hierarchy of needs.