According to the textbook, we tend to call something like a car or a student "good" when it aligns with most people's preferences. is flashy, unique or expensive. functions well and serves its purpose. aligns with our own individual preferences.

Here is the correct statement: We tend to call something like a car or a student 'good' when IT FUNCTIONS WELL AND SERVES ITS PURPOSE.
Each object has a specific purpose for which it is created. When an object fulfills maximally the purpose for which it is made, such an object would be described as good. The same is applicable, when a person is good in what he or she does. Thus, to be good means to have the required qualities.