The Government Has Been Trying to Encourage the Use of Fuel-Efficient

question 20

Multiple Choice

The government has been trying to encourage the use of fuel-efficient cars.One way it has been doing this has been by allowing fuel-efficient cars to use a separate highway lane.This encourages people to use fuel-efficient cars because:

• A) those who place a high value on their scarce time may be encouraged to buy a fuel-efficient car to take advantage of the speedier separate highway lane.
• B) those who place a low value on their scarce time may be encouraged to buy a fuel-efficient car to take advantage of the speedier separate highway lane.
• C) those who are more concerned about the environment are also those who happen to place a high value on their time.
• D) those who purchase a fuel-efficient car are forced to pay more for a new car, and the use of the separate highway lane compensates them for this.
• E) those who purchase a fuel-efficient car are likely to be unhappy because it is less powerful or more cramped inside; use of the separate highway lane compensates them for this.

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Definitions:

Fixed Assets

Long-term tangible assets used in the operation of a business that are not expected to be converted into cash within a year.

Vertical Analysis

A method of financial statement analysis in which each entry for each of the three major categories (assets, liabilities, and equity) is represented as a proportion of the total account.

Profitability Analysis

The process of evaluating the ability of a business to generate earnings as compared to its expenses and other relevant costs incurred during a specific period.

Cost Of Goods Sold

The cost of goods sold is the direct costs attributable to the production of the goods sold by a company, including material and labor costs.