If the Straight-Line Method of Depreciation Rather Than the Reducing-Balance

question 44

Multiple Choice

If the straight-line method of depreciation rather than the reducing-balance method is selected, in the early years of the asset's life the depreciation charge will be comparatively:

• A) greater.
• B) smaller.
• C) the same.
• D) cannot say.

---

Definitions:

Quasilinear Preferences

Preferences where utility is linear in one argument, usually money, allowing for easy analysis of changes in wealth while other goods are evaluated non-linearly.

Homothetic

Pertaining to a class of production functions or utility functions where equal proportionate changes in inputs result in equal proportionate changes in output.

Utility Function

An economic tool used to encode a consumer's preference orderings over a set of alternatives into a real-valued function. (Duplicate rephrase)

Income

Funds obtained regularly as a result of employment or from returns on investments.