The List Price of a New Van Was $30,000 at a Local

question 129

Multiple Choice

The list price of a new van was $30,000 at a local car dealership. However, a customer convinced the dealer to sell the van for $25,000 (the van had cost the dealer $20,000 one year earlier) . The van would cost the dealer $24,000 today. Inflation is 5% per year. The amount of profit that would be recognized by the dealer as a result of the sale using the constant dollar financial capital maintenance approach is:

• A) $10,000
• B) $4,000
• C) $5,000
• D) $9,000

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Definitions:

Human Resources

A business function focused on the management of employee-related processes such as hiring, training, policy implementation, and benefits administration.

Geographic Proximate

The physical closeness or distance of places or entities, influencing interactions and relationships due to location.

Administrative Differences

Variations in the organization, procedures, or policies between different businesses, governments, or institutions.

Liability of Foreignness

The disadvantages or additional costs that firms operating outside their home countries incur, compared to local firms.