Twenty Years Ago, Dmitri Consumed Bread Which Cost Him 10

question 43

Multiple Choice

Twenty years ago, Dmitri consumed bread which cost him 10 kopeks a loaf and potatoes which cost him 20 kopeks a sack.With his income of 330 kopeks, he bought 9 loaves of bread and 12 sacks of potatoes.Today he has an income of 452 kopeks.Bread now costs him 22 kopeks a loaf and potatoes cost him 17 kopeks a sack.Assuming his preferences haven't changed (and the sizes of loaves and sacks haven't changed) , when was he better off?

• A)He was better off 20 years ago.
• B)He is better off today.
• C)He was equally well off in the two periods.
• D)From the information given here, we are unable to tell.
• E)None of the above.

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Definitions:

Fair Value

The estimated market price of an asset or liability, reflecting the amount for which it could be exchanged in an arm's length transaction.

Goodwill

An intangible asset that arises when a business is acquired for more than the fair value of its net identifiable assets, representing the premium paid for the company's reputation, customer base, or brand identity.

Separate Incorporation

A legal entity distinct from its shareholders or owners, recognized as such by law and capable of rights, privileges, and liabilities.