The Following Information Is Given Regarding Driving Lessons Provided by Arrive

question 88

Multiple Choice

The following information is given regarding driving lessons provided by Arrive Alive Company over several spans of time: $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ Length of Time
$$\begin{array} { | l | r | r | r | } \hline & \text { TODAY } & \text { ONE YEAR } & \text { FIVE YEARS } \\\hline \text { Total cost of lessons } & \$ 600 & \$ 110,000 & \$ 508,000 \\\hline \text { Number of lessons } & 50 & 10,000 & 55,000 \\\hline\end{array}$$ Select the incorrect statement from the following.

• A) The average cost per lesson over the five-year period was $9.24.
• B) Based on the most current information,the cost per lesson was $12.00.
• C) The average cost based on the total five-year period is probably the most appropriate cost for pricing purposes.
• D) The selection of the most appropriate time span for calculating the average cost often requires considerable judgment.

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Definitions:

Order Instrument

A financial document payable to a specific individual or entity identified in the document, requiring endorsement by the payee for cashing or deposit.

Payable

Describes an amount of money that is owed and should be paid to a person or organization.

Qualified Endorsement

A type of endorsement on a negotiable instrument, which limits the liability of the endorser.

Without Recourse

A term indicating that the seller of a financial instrument assumes no liability if the instrument fails to perform.