Which of the Following Is True

question 13

Multiple Choice

Which of the following is true?

• A)Successful firms have lower transaction costs than markets do
• B)A legal system that protects ownership rights is critical to the efficient functioning of firms and markets
• C)Markets measure and reward performance
• D)Markets allocate resources to their highest value use
• E)All of the above

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Definitions:

Straight-Line Basis

A method of calculating depreciation or amortization that spreads the asset's cost evenly across its useful life.

Accumulated Depreciation

The total amount of an asset's cost that has been expensed over time due to wear and tear, obsolescence, or age.

Residual Value

The projected sum an asset will fetch at the time of sale, once it has surpassed its lifespan.

Straight-Line Method

A method of calculating depreciation or amortization by evenly spreading the cost of an asset over its useful life.