The Scarcity Principle Tells Us That __________, and the Cost-Benefit

question 71

Multiple Choice

The scarcity principle tells us that __________, and the cost-benefit principle tells us __________.

• A) choices must be made; how to make the choices
• B) choices must be made; that the costs can never outweigh the benefits of the choices
• C) rare goods are expensive; that the costs should outweigh the benefits of the choices
• D) rare goods are expensive; that the costs can never outweigh the benefits of the choices

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Definitions:

U.S.GAAP

The collection of authoritative standards and principles for financial accounting and reporting in the United States, established by the Financial Accounting Standards Board.

IFRS

International Financial Reporting Standards; a set of accounting standards developed by the International Accounting Standards Board (IASB) aiming at standardizing financial reporting across the globe.

Liquidity

A measure of a company's ability to pay off its short-term liabilities with its available cash and quick assets.

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within one year or within the business's normal operating cycle if longer.