Answer:
elasticity of demand is 2.16. Consumers pay a smaller portion of the tax
Explanation:
Elasticity of demand measures the responsiveness of quantity demanded to changes in price.
Elasticity of demand = percentage change in quantity demanded / percentage change in price
(2/19)(2/41) = 2.16
When the coefficient of elasticity is greater than 1, demand is elastic.
Elastic demand means that a small change in price leads to a greater change in quantity demanded.
Because demand is elastic, more of the burden of the tax falls on producers and consumers pay a small portion of the tax.
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A firm has spent the last two years constructing a building to be used as the firm's headquarters. At the end of the first year of construction, the balance of building under construction was $400,000, which includes capitalized interest. During year two, the firm paid $240,000 to the contractor on March 1, and $600,000 on October 1. The building was not finished by the end of the second year. The firm had one loan outstanding all year, an 8%, $3,000,000 construction loan. Compute capitalized interest for year two.
Answer:
$60,000
Explanation:
Given:
Amount at the end of 1st year = $400,000
Paid : $240,000 (on 1st March)
$600,000 (on 1st October)
rate = 8%
Calculation of Capitalized interest
= Weighted Amount Borrowed x Interest rate
= $350,000 x 8% = $28,000
Note: Weighted Amount Borrowed = $240000 x 10/12 = $200,000
= $600,000 x 3/12 = $150,000
Total = $350,000
For the first year = $400,000 x 8% = $32,000
Total Capitalized Interest Amount = $28,000 + $32,000
= $60,000
To compute capitalized interest for year two, add the beginning balance and payments made, calculate the average and weighted average accumulated expenditures, and multiply by the interest rate.
Explanation:To compute capitalized interest for year two, we need to calculate the average accumulated expenditures for the construction of the building.
The average accumulated expenditures can be calculated by adding the beginning balance of building under construction ($400,000) to the payments made during the year ($240,000 on March 1 and $600,000 on October 1), and dividing the sum by 2.
In this case, the average accumulated expenditures would be ($400,000 + $240,000 + $600,000) / 2 = $620,000.
Next, we need to calculate the weighted average accumulated expenditures using the average accumulated expenditures and the time weights.
Since the building was not finished by the end of the second year, the time weights would be 6/12 for the first payment on March 1 and 3/12 for the second payment on October 1.
The weighted average accumulated expenditures would be (($620,000 × (6/12)) + ($620,000 × (3/12))) = $310,000.
Finally, to calculate the capitalized interest, we multiply the weighted average accumulated expenditures ($310,000) by the interest rate (8%).
The capitalized interest for year two would be $310,000 × 8% = $24,800.
Not only do businesses see benefits from the protections of ________, consumers do as well; they allow consumers to correctly identify the products they want to purchase.
a. self-regulations
b. environmental scans
c. patents
d. trademarks
e. copyrights
Answer:
Not only do businesses see benefits from the protections of trademarks, consumers do as well; they allow consumers to correctly identify the products they want to purchase.
d. trademarks
Explanation:
A trademark is a symbol, word or sign that has been registered as representing a company or a product. They are majorly used by companies to identify a product specifically as belonging to that particular company. It usually has unique features that separates the product from similar products in the industry. Once a trademark has been registered, the company that has registered that particular trademark has sole right on its production and use. This means that any other company cannot use this trademark without permission from the company that registered it. It is illegal to use a registered trademark without permission from the owner.
Trademarks are very useful to the business since they are protects the owner from production of similar words, sign or symbols. It therefor avoids confusion in knowing the source owner of the product. This can be a useful tool in marketing since the consumers will use the trademark in identifying the product they want. On this note, the trademarks also allow consumers to correctly identify the products they want to purchase.
Final answer:
Trademarks help consumers identify genuine products and engender trust in the products they purchase, serving a critical role in consumer protection.
Explanation:
Not only do businesses see benefits from the protections of trademarks, but consumers do as well; they allow consumers to correctly identify the products they want to purchase. The correct answer is d. trademarks. Trademarks are crucial in consumer protection as they help to prevent confusion in the marketplace by ensuring that only genuine products carry the trademarked brand. This function supports consumer confidence and trust in the products they buy.
What if the United States Supreme Court had not issued the prior opinion and California courts also had not decided that those clauses contravene a strong public policy? This case would be a case of ________ in California.a. first impressionb. unprecedented issuesc. persuasive authorityd. equity
Answer:
a. first impression
Explanation:
A case of first impression is when the situation has never happened before in a particular state and therefore the court needs to consider the decision from other states as a guideline.
I hope you find this information sueful and interesting! Good luck!
Answer:
a. first impression
Explanation:
A case is first impression when there is no existing precedent to the issue that is no such case has been brought before court in past.
Therefore,
If the United States Supreme Court had not issued the prior opinion and California courts also had not decided that those clauses contravene a strong public policy, this case would be a case of first impression in California.
When Ramona, the keynote speaker at a major business leaders' conference, arrived in the middle of the night at the Ritz-Carlton, she was exhausted and her suit was wrinkled from her ten-hour plane trip. The night clerk found someone to dry clean Ramona's suit and have it ready for her morning presentation. She has been a loyal Ritz-Carlton customer ever since. In this example, Ritz-Carlton demonstrated the macro strategy of:________.
a. customer excellence.
b. operational excellence.
c. product excellence.
d. promotional excellence.
e. global excellence.
Answer:
The correct answer is letter "A": customer excellence.
Explanation:
Customer service is the treat companies provide to their consumers according to the goods or services that the firms provide. When the company engages in activities that go beyond their scope and responsibility to better assist clients, then we are talking about customer excellence.
Suppose you build a model of the market for umbrellas, in which the predicted number of umbrellas sold by a shop depends on their colour and price, ceteris paribus. the colour and the price are variables used to predict sales. which other variables are being held constant?
Answer:
Quantity, location and weather
Explanation:
The concept of the ceteris paribus, is vital in economics as in the real world, it is generally hard to isolate all the variables that are different, and might change the result or outcome.
The ceteris paribus is the simplification, which include holding other things ( both outside as well as inside the model) constant. In this situation, all variables except price and the color are held constant. In this example, such as quantity, weather and location are held constant.
Ceteris paribus, variables kept constant in the model predicting umbrella sales could include factors such as weather conditions, shop location, area competition, time of year, and shop opening hours. These are typically held constant in market models to isolate the impact of the main variables under study.
Explanation:In the context of the question, other variables that could be held constant (ceteris paribus) in a model predicting umbrella sales could include factors like the weather conditions, the location of the shop, the competition in the area, the time of year, and the shop's opening hours. The weather condition especially has a direct impact on umbrella sales. For example, more umbrellas will be sold during the rainy season than in summer. However, Ceteris Paribus, all other things being equal or held constant, these variables do not change. In a market model, researchers often hold these variables constant to isolate the effect of the variable under study – in this case, the effect of the colour and price of umbrellas on sales – and to simplify the model.
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"What is the main reason that it is necessary for public companies to follow the rules and format set out in the Generally Accepted Accounting Principles (GAAP) when creating financial statements?"
Answer:
Unlike private companies or small businesses, publicly listed companies make a significant impact on the economy and the financial markets in general.
Moreover, both foreign and local investors are interested and invest in these companies.
Because of their significance, there should be the ability of comparability of these companies and their financials must be reliable and accurate.
Explanation:
Myrtle, a bank manager, is referred to as a tough boss by her subordinates because she uses bullying management styles to get things done. She sends intimidating emails to the clerical staff at her branch, she threatens the cashier to tally the cash transactions within a particular time limit, and she is abrasive to her subordinates when they try to justify their actions. In this scenario, which of the following is the most evident management mistake being committed by Myrtle?
Insensitivity to others
Answer:
C) Insensitivity to others
Explanation:
Myrtle is not a bully, she seems to be more like a dictator. Besides Myrtle being rude to her subordinates, which is totally wrong, her behavior will cause negative emotions to them. I bet the cashiers and clerks all dislike her, and feel a mixture of anger, fear, stress and sadness about this situation. The real problem is that all of these negative emotions translate into hostility and bad service towards the customers. Customers do notice when bad things are happening in a business, specially in stressful places like banks. Banks by themselves are very stressful places and if you add employer hostility and bad service, it turns into a perfect storm.
Myrtle's management mistake is insensitivity to others.
Explanation:The most evident management mistake being committed by Myrtle is insensitivity to others.
Her bullying management style, which includes sending intimidating emails, making threats, and being abrasive, demonstrates a lack of empathy and consideration for her subordinates.
A more effective approach to management would involve being supportive, understanding, and respectful, fostering a positive work environment.
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Misconduct in research or scholarship includes fabrication, falsification, or plagiarism in proposing, performing, reviewing, or reporting research. It does not include honest error or honest differences in interpretations or judgements of_____________data.
Answer:
Recording data.
Explanation:
An appraiser employed to appraise a commercial strip mall valued at $550,000 must hold which of the following appraisal licenses? (a)certified general (b)certified residential (c)trainee (d)licensed
Answer:
(a)certified general
Explanation:
A certified general appraiser is a licenced person authorised to perform appraisal for real estate. They are authorised to appraise all type real estate irrespective of any complexity or amount of transaction. Appraisal is an opinion of authorised appraiser based on experience, knowledge, research and informations.
The correct answer is (a) certified general. To appraise a commercial strip mall valued at $550,000, the appraiser must hold a certified general appraiser license. This is the only license that qualifies the appraiser to handle all types of real properties, including commercial properties. Therefore, the correct answer is (a) certified general.
Required Appraisal License for Valuating a Commercial Strip Mall
In the appraisal industry, different types of properties require different levels of certification for appraisers. For commercial properties, such as a strip mall valued at $550,000, the appraiser must hold a certified general appraiser license. This is because only a certified general appraiser is qualified to appraise all types of real estate, both residential and non-residential properties, without regard to value or complexity.
Here is the step-by-step explanation:
Certified General Appraiser: Qualified to appraise any type of real property.Certified Residential Appraiser: Qualified to appraise residential properties, but not commercial properties like strip malls.Trainee Appraiser: Works under the supervision of a certified appraiser and cannot independently appraise properties.Licensed Appraiser: Qualified to appraise non-complex residential properties up to a certain value, not sufficient for commercial properties full valuation.Thus, the correct answer is (a) certified general.
Coworkers Yvonne and Rodney are trying to finish cleaning the store by washing dishes and sweeping the floors. To finish both tasks as quickly as possible, they know that each of them should focus on just one task, but they don't know who should do what. To decide which coworker should wash dishes, Yvonne and Rodney should determine which one:
has the comparative advantage in dish washing. T/F
Answer: True- The comparative advantage in the dish washing
Explanation:
Yes, the given statement is true that both the coworkers that is Rodney and Yvonne determining the comparative advantages in the store by washing all the dishes.
The comparative advantages is one of the term that is used to refers to the economical ability that helps in providing the various types of products and also reflecting the overall production opportunity in terms of cost.
Accordion to the given scenario, we use the comparative advantages for determining the person for washing the dishes from both the co-workers.
Therefore, The given answer is correct.
Which of the following is not correct? a. Markets allocate scarce resources with the forces of supply and demand. b. The equilibrium of supply and demand is typically an efficient allocation of resources. c. Governments can sometimes improve market outcomes. d. Externalities cannot be positive.
Answer: D
Explanation:
Carla has been directed by her regional marketing manager to cut prices on seasonal items, place an ad in the local paper, and tell distributors to reduce deliveries for the next month. Which step of the strategic marketing planning process is Carla engaged in?a. evaluate performance. b. define the business mission. c. situation analysis. d. implement marketing mix and resources. e. identifying and evaluating opportunities.
Answer:
D. Implementing marketing mix and resources
Explanation:
Carla is in the step of implementation in the strategic marketing planning because she is responsible for putting the plans of the marketing manager into action and are actions influences marketing mix of product, price, promotion and place.
Suppose matt and bree go out to get pizza. they order breadsticks and a large pepperoni pizza. after eating the breadsticks, and one piece of pizza bree decides to have an additional piece, but she does not eat a third piece. if bree is a rational individual why did she not eat the third piece of pizza? the marginal cost of the
Answer:
The third part was higher than the third part's marginal advantage
Explanation:
If marginal costs exceed marginal profit (MC > MB), then producing a last unit costs us more than the perks of the last unit.The highest amount a customer pays for an extra product or service is the marginal benefits. When demand increases, the marginal benefit usually reduces. The marginal cost of production is the increase in costs resulting from more.
Final answer:
Explaining why Bree did not eat the third piece of pizza due to marginal utility decline and rational decision-making, linked to the law of diminishing marginal utility.
Explanation:
Marginal utility decline: Bree did not eat the third piece of pizza because the marginal utility of consuming that extra piece had diminished. As she ate more pizza, the additional satisfaction she gained from each subsequent slice decreased.
Rational decision-making: Bree stopped at the second additional piece because the marginal utility just equalled the opportunity cost. In this case, the satisfaction gained from one more slice equaled the value of enjoying something else or saving money on food.
Law of diminishing marginal utility: Graphing Joseph's total utility and marginal utility curves would show that marginal utility decreases as he consumes more pizza, confirming the law of diminishing marginal utility.
Like many other marketing strategy specialists, Mark Fritz relies heavily on creativity and originality. Members of his team are selected on the basis of their ability to think divergently, and Mark often conducts activities to ensure that this ability is developed. For instance, before any new project, Mark invites his team to sit together and churn out possible ideas about the new product, its theme, and ways in which it can be projected best in the market. These sessions usually provide him with a bank of potential ideas from which the team selects some strong concepts and develops them into a campaign. To encourage freedom in these sessions, Mark has a no-evaluation policy. This is an example of ________.
A. social loafing
B. brainstorming
C. in-group favoritism
D. groupthink
E. groupshift
Answer:
B. brainstorming
Explanation:
Brainstorming is a process by which ideas are created to tackle a technical, design or a marketing problem. Which generally requires a team, through a facilitator's guidance. Mark Fritz, facilitates his team to to churn out possible ideas about potential products.
The effectiveness of brainstorming is the opportunity members have in making connections in a free-thinking atmosphere among their thoughts, thus expanding the scope for the resolution.
Brainstorming requires leveraging synergy–they are leveraging a collective thought process towards a range of possible solutions.
Suppose that the government wishes to decrease the market equilibrium monthly rent by increasing the supply the housing. Assuming that demand remains unchanged, by how many units of housing would the government have to increase the supply of housing in order to get the market equilibrium rental price to fall to $1500 per month? To $1000 per month? To $500 per month?
(a) 12,500 apartments at a rent of $2000 per month
(b) A shortage of 5,000 apartments per month, 10,000 apartments will actually be rented each month
(c) A surplus of 5,000 apartments per month, 10,000 apartments will actually be rented each month
(d) 2,500 more apartments, 5000 more apartments; 7,500 more apartments.
Answer:
,000 new apartments will make the equilibrium price = $1,50010,000 new apartments will make the equilibrium price = $1,00015,000 new apartments will make the equilibrium price = $500Explanation:
Rent Demand Supply
2,500.00 10000 15000
2,000.00 12500 12500
1,500.00 15000 10000
1,000.00 17500 7500
500.00 20000 5000
The equilibrium quantity is 12,500 apartments with a $2,000 rent per month. If the government wants to lower the equilibrium rent price by increasing the supply of apartments, then it must build:
5,000 new apartments will make the equilibrium price = $1,50010,000 new apartments will make the equilibrium price = $1,00015,000 new apartments will make the equilibrium price = $500When the demand for an apartment is equal to the supply, the equilibrium rental price per month is computed. As a result, there is no point at which demand equals supply.
Option a is the correct answer to the given market equilibrium situation.
The tabulation of the rental price equilibriumRent Demand Supply
2,500.00 10000 15000
2,000.00 12500 12500
1,500.00 15000 10000
1,000.00 17500 7500
500.00 20000 5000
With a monthly rent of $2,000, the equilibrium quantity is 12,500 apartments.
If the government intends to reduce the equilibrium rent price by expanding apartment supply, it must construct
With 5,000 new flats, the equilibrium price will be $1,500.For more information about market equilibrium, refer below
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Heather has been assessing several of her firm's products using the Boston Consulting Group (BCG) approach to portfolio analysis. She has been trying to assess the strength in a particular market and is looking at the sales of each of her products and the sales of the largest firm in the industry. Heather is trying to determine
Answer:
A.
Explanation:
Based on the information provided within the question it can be said that in this scenario Heather is trying to determine the product's relative market share. This term refers to metric used in marketing in order to be able to compare the company's market share to the market share of other large competitors in the same market.
Digital marketing has become an increasingly important element of the marketer's toolbox. according to a survey conducted by pew research center, ________ of americans use at least one social networking site.
Answer:
73%
Explanation:
Digital marketing is promotion of goods and services using digital tools such as email, search engines, social media, and websites on the internet.
The trend is on the increase and there is more emphasis on developing digital marketing tools, so marketers use services like web design, search engine optimisation, and ecommerce.
Digital marketing has the advantage of always being available so your business never sleeps.
Which is the proper order for distribution of assets upon dissolution of a limited partnership? a. outside creditors; distributions owed to partners; capital contributions; remainder split according to distribution agreement b. outside creditors; limited partners' profits; limited partners' capital; general partners' advances; general partners' profit; general partners' capital c. limited partners' capital; outside creditors; limited partners' advances; general partners' capital and profits d. none of the above
Answer:
from the given options, the answer is b. outside creditors; limited partners' profits; limited partners' capital; general partners' advances; general partners' profit; general partners' capital
Explanation:
This happens usually when the partenrship is dissolved. Then the assets must cover all the obligations the firm has.
it starts from the external creditors, and slowly goes to Limited Partner, who has more right to recieve funds than the general partners. This is because the limited parter is only liable for his amount of contribution.
Only after satisfying all the external obligations the general partners have the ability to pay themselves!
Natasha, the general manager of a putting range, believes that her workers are responsible and capable, and that they can be trusted when given responsibility. Natasha is an example of a(n) ________ manager.
A. contingency
B. Theory X
C. Theory Y
D. Theory Z
E. participative
Answer:
C) Theory Y
Explanation:
Theory Y is the opposite of theory X. While theory X focuses on the negative side of employees, theory Y focuses on the positive aspects and qualities of employees.
Theory Y managers tend to have a positive attitude towards humanity as a whole, and believe in their employees' capacities. They try really hard to motivate them to give 100%. Theory Y managers believe that their employees actually like their work, can work independently, are responsible, are motivated to perform better and if given the chance will be able to make good decisions.
Natasha, the general manager of a putting range, is an example of a Theory Y manager. Theory Y managers believe that employees are responsible, capable, and can be trusted with responsibilities.
Explanation:Natasha, the general manager of a putting range, is an example of a Theory Y manager. Theory Y managers believe that employees are responsible, capable, and can be trusted with responsibilities. These managers emphasize on employee empowerment, participation in decision-making, and creating a positive work environment.
By displaying trust in her workers' abilities and giving them responsibilities, Natasha promotes a participative management style. This style involves involving employees in the decision-making process, encouraging their inputs and ideas, and sharing information with them. It fosters a sense of ownership and commitment among employees, leading to higher job satisfaction and productivity.
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A marketing manager decides what combination of variables is needed to satisfy customers' needs for a general type of product. What are the essential variables that the marketing manager combines?
Answer:
Product, price, distribution and promotion variables.
Explanation:
If a country produced nothing but 20 smartphones and 10 Blu-ray players in 2017, priced at $100 per smartphone and $200 per Blu-ray player, its GDP in 2017 would be:
a. $5,000.
b. $1,000.
c. $4,000.
d. $2,000.
Answer:
The correct answer is option c.
Explanation:
A country produces two goods, smartphones, and Blu-ray players. The quantity of smartphones is 20, its price is $100.
While the quantity of Blu-ray players is 10 and the price is $200.
The GDP of a country measures the value of final goods and services produced in the country in a year.
The GDP of this country will be
= [tex](20\times \$100) + (10\times \$200)[/tex]
= $2,000 + $2,000
= $4,000
Gonzalez Company has 350,000 shares of $10 par value common stock outstanding. During the year, Gonzalez declared a 10% stock dividend when the market price of the stock was $30 per share. Four months later Gonzalez declared a $.50 per share cash dividend. As a result of the dividends declared during the year, retained earnings decreased by
Retained earnings decreased by $192,500 as a result of a $.50 per share cash dividend declared by Gonzalez Company. The 10% stock dividend did not affect retained earnings because it was distributed at par value and only reclassified equity.
When Gonzalez Company declared a 10% stock dividend, it distributed additional shares to its shareholders. Since there were 350,000 shares outstanding and the company declared a 10% stock dividend, this resulted in 35,000 additional shares being distributed (10% of 350,000). The market value of these shares at the time was $30 per share, which results in a total value of $1,050,000 (35,000 shares imes $30). However, for accounting purposes, stock dividends are not recorded at market value. Instead, they affect the stockholders' equity section by transferring from retained earnings to common stock and additional paid-in capital.
Later, when the company declared a $.50 per share cash dividend, this resulted in a straightforward reduction in retained earnings. With 385,000 shares now outstanding (original 350,000 + 35,000 new stock dividends), the total cash dividend paid would be $192,500 ($.50 imes 385,000). This amount was deducted from Gonzalez Company's retained earnings.
Therefore, to calculate the total decrease in retained earnings as a result of the dividends declared during the year, we only need to consider the cash dividend:
Decrease in retained earnings from the cash dividend: $192,500The stock dividend did not decrease the retained earnings because it was distributed at par value, which is accounted for by just rearranging the equity sections without affecting the total retained earnings.
A factory worker earns $500 per week and will receive a $2,000 bonus at year-end, a 2-week paid vacation, and 5 paid holidays. The combined amount of the accruals for bonus, vacation, and holiday pay in the weekly payroll would be:
Answer:
$70
Explanation:
Data provided in the question:
Earnings per week = $500
Bonus received per year = $2,000
Paid vacation = 2 weeks
Paid holidays = 5
Now,
Since the workers have 2 weeks of vacation the fringe benefit will be calculated for 50 weeks
[as 1 year have 52 weeks, so 52 - 2 weeks = 50 weeks]
Now,
Bonus per week = $2,000 ÷ 50 weeks
= $40 per week
Vacation pay for the year = Earning per week × Total vacation per year
= $500 × 2 weeks = $1,000
Thus,
Vacation pay per week = $1,000 ÷ 50 weeks
= $20 per week
since there are 5 days working in a week
Holiday pay per day = $500 ÷ 5 days
= $100 per day
Thus,
Total holiday pay for a year = Holiday pay per day × total holidays per year
= $100 × 5
= $500
Therefore,
Holiday pay per week = $500 ÷ 50 weeks
= $10 per week
Hence,
Combined amount of accrual
= $40 + $20 + $10
= $70
Final answer:
To calculate the weekly accrual for a factory worker's bonus, vacation, and holiday pay, combine the annual bonus ($2,000), vacation pay ($1,000), and holiday pay ($500), and divide the sum ($3,500) by 52 weeks to get a weekly accrual of $70.00.
Explanation:
The student has asked to calculate the combined amount of the accruals for a bonus, vacation, and holiday pay in the weekly payroll for a factory worker earning $500 per week with additional benefits. To determine the total accrual per week, we need to add the year-end bonus, the value of the paid vacation, and the value of the paid holidays, then divide this sum by the number of weeks in a year to find the weekly amount.
Year-end bonus: $2,000 (already given as an annual figure)
Paid vacation: 2 weeks of vacation at $500 per week equals $1,000
Paid holidays: 5 holidays at $500 per week, divided by a standard 5-day workweek, equals 5 days of pay. This is $500/5 days = $100 per holiday, for a total of $500.
The yearly total of additional benefits is $2,000 (bonus) + $1,000 (vacation) + $500 (holidays) = $3,500.
To find the weekly accrual amount, divide the yearly total by 52 weeks: $3,500 / 52 weeks = $70.00 (rounded to two decimal places).
Therefore, the weekly accrual for the combined amount of bonus, vacation, and holiday pay in the weekly payroll is $70.
Which of the following knowledge tools must a salesperson use to answer the question "Can the salesperson give additional discounts to get a potential client whom the company has been after for years?"A) Price knowledge
B) Customer knowledge
C) Technology knowledge
D) Market knowledge
E) Product knowledge
Answer:
Price knowledge
Explanation:
Price knowledge - it is referred to as the deep knowledge of the price of the product. it helps in marketing tactic that is used to persuade the customer. it helps in negotiating with the customer on the price.
For example - to persuade potential customers, the salesman should have a broad knowledge of the price of the product so that if customers are ready for buying the product then the additional discounts can offer to lure them.
Thirty years ago daniel bought a plot of land for $50,000 when the cpi was 50. now the cpi is 180 and he sold the land for $180,000. what issue might inflation cause for daniel?
Inflation, reflected by the increase in the Consumer Price Index, can erode the purchasing power of money over time. Although Daniel sold his land for a nominal profit, the real value of the money he received is essentially the same as what he paid 30 years ago, when adjusted for inflation.
Explanation:Inflation can cause a seemingly profitable sale like Daniel's to be less beneficial than it appears. Although Daniel sold his land for $180,000, which is a substantial apparent increase from his original purchase price of $50,000, it's important to consider the impact of inflation represented by the increase in the Consumer Price Index (CPI) over the same period. The CPI has increased from 50 to 180 during the 30 years, meaning the average price level (and therefore the general cost of living) has gone up by 260%.
When taking inflation into account, Daniel's $180,000 doesn't have the same purchasing power today as it would have had 30 years ago. To calculate the inflation-adjusted selling price, we'd need to scale up the original purchase price in proportion to the increase in the CPI. This gives an inflation-adjusted selling price of $50,000 * (180 / 50) = $180,000. Therefore, after adjusting for inflation, Daniel didn't make any real profit from the sale.
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If the 10-year Treasury bond rate is 5.3 %, the inflation premium is 2.8 %, and the maturity-risk premium on 10-year Treasury bonds is 0.2 %, assuming that there is no liquidity-risk premium on these bonds, what is the real risk-free interest rate?
Answer:
2.3%
Explanation:
If nominal interest rate (10-year Treasury bond rate) = real risk free interest rate + inflation premium + default risk premium + maturity risk premium + liquidity risk premium
Then real risk free interest rate = nominal interest rate - inflation premium - default risk premium - maturity risk premium - liquidity risk premium
real risk free interest rate = 5.3% - 2.8% - 0% - 0.2% - 0% = 2.3%
A firm that specializes in alternative energy releases a new and highly efficient solar battery. During the _________ stage of the product cycle, other firms will begin to produce the product and sales will continue to increase.
Answer: Growth Stage.
Explanation:
In the growth stage of the product cycle of the new product, there would still be an increase in sales for the original producer of the new product: because they entered the market earlier and therefore would have many consumers loyal to their brand regardless of the competition in the market.
A mining company closed down operations at an isolated mine it owned and informed the electric company that electricity in the power poles that led to the mine should be cut off. However, the electric company, following its standard policy, left the power running in the line to deter thieves from stealing valuable transformers and cables. The mining company was unaware that the power was left on. A hitchhiker who was passing by the entrance to the mine saw that it was closed, so he went onto the property and climbed up a power pole to steal a transformer. He received an electric shock and fell from the pole, suffering serious injuries.If the hitchhiker sues the mining company, which is the mining company's strongest defense?
A. The hitchhiker was a trespasser.
B. The hitchhiker was a thief.
C. The mining company asked the utility company to turn off the power.
D. The mining company was unaware that the utility company had not turned off the power.
Answer:
A. The hitchhiker was a trespasser.
Explanation:
The hitchhiker's was a trespasser is the mining company's strongest defense. Therefore the mining company owed no duty to the hitchhiker, and is not liable for the injuries of the hitchhiker because a property owner owes no duty to an undiscovered trespasser.
Although, option C and D can also be used as a defense, the best option that the mining company can use is option A. The hitchhiker was a trespasser completely relieving the mining company of any liability for his injuries.
Nancy checks her margin account and notices she has an SMA balance in her account. A 10% stock dividend was declared this morning on one of the companies she had purchased on margin. She asks her RR how this will affect her SMA balance. How should the RR respond?
Answer:
Dividend declare has no impact on the SMA. RR would respond the following way.
Explanation:
SMA is known as “Special Memorandum Account”. It is simply a line of credit, neither cash nor equity. It is created with the market value of the securities increase in the value. The purpose of SMA is to maintain the buying power that is provided by unrealized gains towards the subsequent purchases. SMA is an appropriate way to maintain stable account value and minimize unnecessary accounts funding.
SMA increases with the increase in the value of the security, but does not decrease when the security falls in the value.
SMA is increased by the transactions such as cash deposits, interest income or dividend received or security sales. Dividend declared by the company creates a positive sentiments in the minds of investors. However, it will not create any impact on the SMA account, until it is actually received.
The RR should respond that her SMA balance will not include the dividend. When you have a margin account, any dividends declared have no effect on the SMA account until the margin loan is paid back. A margin account is essentially a loan from your brokerage firm. That loan must be paid off first before you collect any balances.
Jeremy owns a muffler shop in a large city. He provides services such as muffler repair, replacement, and minor car repair work. Last week Harold came into his businessdriving a 1957 Belair Convertible and told Jeremy that he wanted to convert it to a street-rod. He asked Jeremy if he would adjust the muffler so it would emit 125 decibels to give it a "muscle" sound. Harold told Jeremy he would pay an extra $1,000 in cash to get the work done. The legal limit for exhaust system noise is 95 decibels. Jeremy could do the work in a few hours and knows that no one would know that it came from his shop. His business has been slow lately and he is having a difficult time meeting his financial obligations; in addition, his son was just diagnosed with cancer. Which of the following is mostcorrect regarding Jeremy’s decision?
A. Jeremy must make a decision that will impact society
B. Jeremy is facing a moral, legal, and ethical decision.
C. Jeremy must make a decision that will impact him, personally
D. Jeremy has no decision to make, he must comply with the law.
Answer:
B) Jeremy is facing a moral, legal, and ethical decision.
Explanation:
Jeremy knows that what he is doing is not legal, since the legal limit for exhaust system noise is 95 decibels and he will alter the cars muffler so that it reaches 125. Besides that, he faces moral and ethical dilemmas because his business is not doing well and his son has just been diagnosed with cancer and he needs money and a lot of it.