Which of the Following Best Explains Why Market Prices Are

question 16

Multiple Choice

Which of the following best explains why market prices are useful to a financial manager when performing a cost-benefit analysis?

• A) They can be used to determine how much an asset can be sold for.
• B) They can be used to convert different services and commodities into equivalent cash values which can be compared.
• C) They allow all commodities and services to be assigned a fixed and unchanging value.
• D) They can be evaluated to determine whether the market in which the manager exchanges goods and services offers true value.

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Definitions:

Common Laws

Laws that have developed through court decisions, traditions, and legal precedents rather than through legislative statutes.

Agency

A legal relationship in which one party (the agent) acts on behalf of another party (the principal) in dealing with third parties.

Limited Liability Partnership

A limited liability partnership (LLP) is a legal entity where partners have limited liabilities, protecting their personal assets from business debts and obligations.

Partnership Agreement

A formal arrangement between two or more parties to manage and operate a business and share its profits.