Which of the Following Is an Example of the Fact

question 174

Multiple Choice

Which of the following is an example of the fact that people are prone to inertia?

• A)an individual deciding to continue with an insurance policy even after its premium rate increases and alternative policies are available in the market
• B)an individual deciding to decrease the consumption of a commodity when the utility derived from it falls
• C)an individual deciding to opt for additional savings schemes apart from those set as the default by employers
• D)an individual replacing high-power electrical lights and appliances with low-power ones to reduce electricity consumption per month
• E)an individual visiting a new grocery store for her monthly grocery shopping

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Definitions:

Rent

Payment made by a tenant to a landlord for the use of a property.

Depreciation

The allocation of the cost of an asset over its useful life.

EBIT

Earnings Before Interest and Taxes, a measure of a company's profitability that excludes interest and income tax expenses.

Degree of Financial Leverage

A measure of a company's use of borrowed funds to finance its operations, indicating the sensitivity of its earnings to fluctuations in operational income.