4. The price the government pays for standard weapons purchased from military contractors is determined by a pricing method called "historical costing"Historical costing allows contractors to protect their profits by adding a percentage increase,based on the current rate of inflation,to the previous year’s contractual price.
Which of the following statements,if true,is the best basis for a criticism of historical costing as an economically sound pricing method for military contracts?
(A) The government might continue to pay for past inefficient use of funds.
(B) The rate of inflation has varied considerably over the past twenty years.
(C) The contractual price w-II be greatly affected by the cost of materials used for the products.
(D) Many taxpayers question the amount of money the government spends on military contracts.
(E) The pricing method based on historical costing might not encourage the development of innovative weapons.
答案是A, 可A中的inefficient use of funds在文中哪里有体现?
well, the question calls for weakening the conclusion that historical costing is an economically sound pricing method for military contracts. Thus, the right answer must involve some facts which can indicate this method is unsounded. According to the arguement, this method is based on an original price-the price in the first business between government and military contractors. if the goverment made inefficient use of funds at first, for example, the goverment mistakenly paid 100 dollars for sth which actually costs 1 dollars, the goverment would ceaselessly paid for the first mistake in the ensuing years.
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