Question

Decide whether the following statement makes sense (or is clearly true) or does not make sense (or is clearly false).Explain your reasoning.

Emma and Emily are good friends who do everything together, spending the same amount on eating out, entertainment, and other leisure activities. Yet Emma has a negative monthly cash flow while Emily's is positive, because Emily has more income.

Choose the correct answer below.

A.This statement makes sense because Emily makes more money than Emma, so she has a greater cash flow at the end of the month.

B.The statement makes sense because even though Emma and Emily spend the same amount on entertainment expenses, they may spend different amounts on other expenses. Regardless of income, Emma's and Emily's cash flows could be positive or negative.

C.This statement does not make sense because Emma uses a credit card for her expenses and Emily uses cash for her expenses.

D.This statement does not make sense because Emily's rent could be lower than Emma's, which means that she will have a greater monthly cash flow.

Answer 1

Answer: A.This statement makes sense because Emily makes more money than Emma, so she has a greater cash flow at the end of the month.

Explanation:

Emily has more monthly income and even if the duo spend exactly the same figure on everything they participate in, Emma will always come off short (negative monthly cash flow) because she does not earn as much as Emily does but spends equally.