Which of the Following Transactions Is Represented by the Diagram

question 34

Multiple Choice

Which of the following transactions is represented by the diagram below?

• A)A lumber yard where customers may pay with cash for all purchases.
• B)A buy-here-pay-here auto dealer where a car buyer sends monthly cash payments to the dealer.
• C)A consulting firm that offers a variety of consulting services to other businesses.
• D)A department store that allows customers to carry a balance and to make installment payments, if they choose.

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Definitions:

Maximize Profits

The process by which a firm determines the price and output level that returns the greatest profit.

Maximize Utility

The process of making choices to achieve the highest total level of satisfaction or benefit from consumed goods or services.

Rational

The characteristic of an individual or decision that is based on logic and aimed at achieving maximum utility.

Maximize Utility

The economic theory or objective of achieving the highest level of satisfaction possible with available resources.