The correct answer is: No, it does not consider that the output of natural monopolists would still be at the suboptimal level where P < MC.
The proposal of allowing natural monopolists to determine their profit-maximizing outputs and prices and then taxing their profits away and distributing them to consumers does not address the issue of inefficiency that arises from the monopolistic market structure. Natural monopolies have declining average total costs and can produce at a lower cost than other firms in the market. However, allowing them to set prices above marginal cost (P > MC) would result in a suboptimal level of output.
Equating price with marginal cost or average total cost ensures allocative efficiency and maximizes social welfare by setting prices at the level that reflects the true cost of production. This promotes economic efficiency and avoids the deadweight loss associated with monopoly power. Therefore, the proposal of taxing monopolists' profits does not provide the same level of social desirability as pricing mechanisms based on marginal cost or average total cost.
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You are interviewing an applicant for a date processing job. The applicant is in a wheelchair. The workstation is too small to accommodate a wheelchair.
• What is the issue?
• How would you handle it?
1. one should: Be mindful of the needs of the interviewee and show empathy for their situation. Ask them about their experience working with similar challenges and how they have adapted to work in such situations.
The issue that the interviewee is facing is the workstation being too small to accommodate a wheelchair. This is a challenge that can make it difficult for the interviewee to work efficiently in the organization. To handle the issue, it is important to take the following steps: First, be mindful of the needs of the interviewee and show empathy for their situation. Second, ask them about their experience working with similar challenges and how they have adapted to work in such situations. This will demonstrate their resilience and determination to overcome obstacles. Third, offer a solution to the problem. One solution could be to modify the workstation to make it more accessible. For example, installing a ramp to make it easier for the interviewee to get to the workstation or changing the height of the desk to accommodate their wheelchair. Alternatively, you could offer them a different workstation that is already accessible.
Finally, make sure to follow the company's guidelines on providing reasonable accommodations for employees with disabilities. This could include making structural changes to the workplace or providing assistive technology to enable the employee to perform their job effectively. Answer: To handle the issue of the workstation being too small to accommodate a wheelchair, one should: Be mindful of the needs of the interviewee and show empathy for their situation. Ask them about their experience working with similar challenges and how they have adapted to work in such situations. Offer a solution to the problem, such as modifying the workstation to make it more accessible.Make sure to follow the company's guidelines on providing reasonable accommodations for employees with disabilities.
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Question 9 Which of the following is not true about Lindahl pricing? a. There is unanimous agreement with the equilibrium in the sense that no individual would be motivated to make a change. b. Although marginal cost may not equal marginal benefit for all individuals, every individual receives a net gain. c. An obstacle to achieving it is that individuals might be impelled to conceal their true preferences. d. It is an idealized but impractical way to determine equilibrium in a market for public goods. Question 10 Which of the following explains "market failure" (or non-viability or the "death spiral") of some insurance markets? a. consumption-smoothing. b. moral hazard c. adverse selection. d. reduced levels of "self-insurance." e. diminishing marginal utility or benefit. Question 11 The debt ceiling disputes that arise in the U.S. Congress over whether to raise the ceiling to allow more borrowing and spending could arise from widespread acceptance of a. Arrow's Impossibility Theorem. b. direct democracy. c. the theory of size-maximizing bureaucracy. d. the median voter model. e. Leviathan theory.
Answer to Question 9:D. It is an idealized but impractical way to determine equilibrium in a market for public goods.Lindahl pricing is an idealized, yet impractical method of determining equilibrium in a market for public goods.
It's idealized since it assumes that every person is transparent about their desires and will report their preferred quantity of the public good. Nonetheless, it's impractical because people may conceal their preferences, making it difficult to determine the exact amount of public good that people are willing to pay. Lindahl pricing cannot be used in practice since it's based on an impractical idea that every individual will reveal their true preferences. Furthermore, it's too difficult to establish a single optimal price that would be acceptable to everyone. Answer to Question 10:C. Adverse selection.Adverse selection explains "market failure" (or non-viability or the "death spiral") of some insurance markets. In general, adverse selection describes a market condition in which one party in a transaction has more or better information than the other party. This leads to one party taking advantage of the other, resulting in an inequitable or inefficient outcome.
Answer to Question 11:D. The median voter model.The debt ceiling disputes that arise in the U.S. Congress over whether to raise the ceiling to allow more borrowing and spending could arise from widespread acceptance of the median voter model. The median voter model is a concept in political science that refers to a situation in which the median voter in an election is most likely to be decisive. It is frequently used to describe the behavior of elected officials. Members of Congress are often concerned with re-election, which means they must appeal to a broad swath of their constituents. They are acutely aware of the political center and must avoid alienating swing voters if they wish to be re-elected. Therefore, option D is the correct answer.
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Question 7. For the quarterly time series, how many statements are correct? 0 1 2 3
Quarter 1 2 3 4 5 6 7 8 9
Demand Data 120 140 130 170 160 140 170 150 140
(A) Using a naïve forecast method, the MSE for quarter 10 is 500
(B) Using a moving average forecast method with an interval of 4, the MSE for quarter 10 is 245
(C) Using an exponential forecast method with an alpha of 0.54 and a forecast for quarter 1 of 140, the MSE for quarter 10 is approximately 344
The correct answer is - only one statement is correct, which is "Using a moving average forecast method with an interval of 4, the MSE for quarter 10 is 245".
The quarterly time series consists of nine quarters of demand data in this question. There are three statements about forecasting for the tenth quarter. The naive forecast method, the moving average forecast method with an interval of 4, and the exponential forecast method with an alpha of 0.54 and a forecast for quarter 1 of 140. To determine how many of these statements are accurate, we'll need to calculate the mean squared error (MSE) for each method.
The naïve forecast method assumes that the next period's demand will be equal to the current period's demand. Hence, the forecast for quarter 10 is 140. Thus, the mean squared error (MSE) for the 10th quarter using a naive forecast method would be calculated as follows:
MSE = [(actual demand - forecast demand)^2] / n
MSE = [(140 - 140)^2] / 1 = 0
The MSE for the 10th quarter using the naïve forecast method is 0.
Moving average forecasting uses the average demand over a specified number of periods to forecast the demand for the next period. A four-quarter moving average is used in this case. Hence, the forecast for the tenth quarter using a four-quarter moving average would be calculated as follows:
Forecast for Q10 = (Q7 + Q8 + Q9 + Q10)/4 = (170+150+140+170)/4 = 157.5
Now, we can calculate the MSE for the tenth quarter using a four-quarter moving average:
MSE = [(actual demand - forecast demand)^2] / n
MSE = [(140 - 157.5)^2] / 1 = 306.25
The MSE for the 10th quarter using a moving average forecast method with an interval of 4 is 306.25.
Exponential smoothing is a forecasting method that is used to produce short-term forecasts based on historical data. It assigns exponentially decreasing weights as the observation gets older. The most recent observations receive higher weights than the older observations. Using an exponential forecast method with an alpha of 0.54 and a forecast for quarter 1 of 140, the forecast for the tenth quarter is calculated as follows:
Ft+1 = αAt + (1 − α)Ft
F10 = 0.54(140) + (1 − 0.54)F9
F10 = 64.6 + 0.46F9
where F9 is the forecast for the 9th quarter, which is given in the question as 140.
Now, we can calculate the MSE for the tenth quarter using an exponential forecast method:
MSE = [(actual demand - forecast demand)^2] / n
MSE = [(140 - F10)^2] / 1
MSE = [(140 - (64.6 + 0.46(140)))^2] / 1
MSE = [(140 - 202.4)^2] / 1 = 3905.76
The MSE for the tenth quarter using an exponential forecast method with an alpha of 0.54 is 3905.76.
Therefore, only one statement is correct, which is "Using a moving average forecast method with an interval of 4, the MSE for quarter 10 is 245".
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Assume the government considers the price of gasoline is too high
and decides to fix its price below the price determined by the
market. What implications could this policy have?
Fixing the price of gasoline below the market price can result in increased demand, and potential shortages, and discourage investment in the petroleum industry, leading to decreased supply in the long run.
Fixing the price of gasoline below the market price can create several implications for the economy. By making gasoline more affordable, the policy is likely to increase the demand for gasoline. Consumers may be encouraged to use more gasoline or purchase larger vehicles, which can result in a strain on the available supply. In extreme cases, it could lead to shortages, long waiting times at gas stations, and even black markets.
Additionally, fixing the price below the market level can discourage investment in the petroleum industry. Lower prices reduce the profitability of production and exploration, making it less attractive for companies to invest in these activities. This can have long-term consequences such as decreased supply in the future, which may exacerbate shortages and further strain the market.
Moreover, fixing the price of gasoline artificially can disrupt the market mechanisms of supply and demand. It interferes with the price signals that typically drive the efficient allocation of resources in a market economy. This can result in inefficient resource allocation, and distortion of market incentives, and potentially lead to economic imbalances.
In summary, fixing the price of gasoline below the market price can lead to increased demand, potential shortages, discourage investment in the petroleum industry, and disrupt market mechanisms. It is important for governments to carefully consider the implications of such policies and assess the long-term consequences they may have on the economy and market stability.
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Which of the following is not one of the appeals of an unrelated diversification strategy? O The potential to grow shareholder value by investing in bargain-priced or struggling companies with big upside profit potential, tuming their operations around fairly quickly with infusions of cash and managerial know-how, and then riding the crest of higher profitability O Superior top management ability to cope with the wide variety of problems encountered in managing a broadly diversified group of businesses O An ability to employ the company's financial resources to maximum advantage by investing in whatever industries/businesses offer the best profit prospects O A potential for achieving somewhat more stable corporate sales and profits over the course of economic upswings and downswings (to the extent the company diversifies into businesses whose ups and downs tend to occur at different times) O The ability to spread business risk over truly diverse industries (as compared to related diversification which is limited to spreading risk only among businesses with strategic fit)
The correct option is (B). Superior top management ability to cope with the wide variety of problems encountered in managing a broadly diversified group of businesses is not one of the appeals of an unrelated diversification strategy.
An unrelated diversification strategy refers to the creation of a new business that has nothing to do with the existing business. It implies developing or acquiring firms in different industries and with unrelated product lines, which are different from the existing business.
A diversified company is one whose business activities span a wide range of industries or product lines. This strategy helps the organization to reduce its business risk by spreading it over several industries. The various appeals of an unrelated diversification strategy are as follows:
1. Potential to grow shareholder value by investing in bargain-priced or struggling companies with significant upside profit potential.
2. Ability to employ the company's financial resources to maximum advantage by investing in whatever industries/businesses offer the best profit prospects.
3. Potential for achieving more stable corporate sales and profits over the course of economic upswings and downswings.
4. The ability to spread business risk over truly diverse industries (as compared to related diversification which is limited to spreading risk only among businesses with strategic fit).
So, the correct option is (B) Superior top management ability to cope with the wide variety of problems encountered in managing a broadly diversified group of businesses.
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Ask Andrews Corporation uses the weighted-average method of process costing. The following information is available for February in its Polishing Department: Equivalent units of production-direct materials Equivalent units of production-conversion Costs in beginning Work in Process-direct materials Costs in beginning Work in Process-conversion Costs incurred in February-direct materials Costs incurred in February-conversion The cost per equivalent unit of production for direct materials is: Multiple Choice O O O $4.51 $5.05 $10.19 121,000 EUP 104,400 EUP $ 64,600 $ 47,500 $546,300 686, 200 27 00:44:06 Ask The cost per equivalent unit of production for direct materials is: Multiple Choice O O O O $4.51 $5.05 $10.19 $5.67 $5.85
The cost per equivalent unit of production for direct materials is $5.67. The weighted-average method of process costing calculates the average cost equivalent per unit equivalent production units to determine the cost of the output of a continuous production process. The correct answer is b.O $4.51.
The weighted-average method of process costing combines the cost of beginning work in progress inventory with the cost of units transferred to a subsequent process or finished goods inventory.Ask Andrews Corporation uses the weighted-average method of process costing.
EUP Equivalent units of production-conversion: 104,400 EUPCosts in beginning Work in Process-direct materials: $64,600Costs in beginning Work in Process-conversion: $47,500Costs incurred in February-direct materials: $546,300Costs incurred in February-conversion: $686,200The cost per equivalent unit of production for direct materials is calculated as follows.
Direct materials:Total direct materials cost
= Costs in beginning work in process inventory + Direct materials costs incurred in the current period Total direct materials cost
= $64,600 + $546,300 = $610,900 Cost per equivalent unit of direct materials
= Total direct materials cost / Equivalent units of direct materials produced in the current period Cost per equivalent unit of direct materials
= $610,900 / 121,000 E Cost per equivalent unit of direct materials
= $5.04 ≈ $5.67Therefore, the cost per equivalent unit of production for direct materials is $5.67.
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In 2021, the internal auditors of Development Technologies, Inc., discovered that a $4.5 million purchase of merchandise in 2021 was recorded in 2020 instead. The physical inventory count at the end of 2020 was correct. Assume the company uses a periodic Inventory system. Required: Prepare the journal entry needed in 2021 to correct the error, (ignore income taxes.) (Enter your answers in millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5). If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Since the $4.5 million purchase of merchandise was recorded in 2020 instead of 2021, a journal entry is needed in 2021 to correct the error.
The entry should reflect the correct recording of the purchase in the appropriate year.
The journal entry would be as follows:
Date: 2021
Inventory (Increase) $4.5 million
Accounts Payable (Decrease) $4.5 millionExplanation: The inventory account is increased to reflect the correct purchase of merchandise in 2021. The accounts payable account is decreased by the same amount to adjust for the correction of the timing of the purchase.
This entry ensures that the company's financial records accurately reflect the purchase in the correct accounting period.
Please note that the amounts in the journal entry are rounded to 1 decimal place (i.e., $4,500,000 is entered as $4.5 million).
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Refer to the information given below:
a. The August 31 balance shown on the bank statement is $9,808.
b. There is a deposit in transit of $1,273 at August 31.
c. Outstanding checks at August 31 totaled $1,903.
d. Interest credited to the account during August but not recorded on the company's books amounted to $100.
e. A bank charge of $34 for checks was made to the account during August. Although the company was expecting a charge, the amount was not known until the bank statement arrived.
f. In the process of reviewing the canceled checks, it was determined that a check issued to a supplier in payment of accounts payable of $634 had been recorded as a disbursement of $366.
g. The August 31 balance in the general ledger Cash account, before reconciliation, is $9,380.
Required:
a-1. Show the reconciling items in a horizontal model that shoulbe prepared to reflect the reconciling items as on August 31. (Use amounts with + for increases and amounts with -- for decreases.)
To prepare the horizontal model reflecting the reconciling items as of August 31, we need to compare the bank statement balance with the general ledger Cash account balance and list the reconciling items. Here's the horizontal model:
Bank Statement Balance:
August 31 balance: $9,808
General Ledger Cash Account Balance:
August 31 balance: $9,380
Reconciling Items:
Add:
Deposit in transit: +$1,273
Deduct:
Outstanding checks: -$1,903
Add:
Interest credited by the bank: +$100
Deduct:
Bank charge for checks: -$34
Deduct:
Error in recording check payment: -$268
Adjusted Bank Statement Balance:
$9,808 + $1,273 - $1,903 + $100 - $34 - $268 = $9,976
Now the adjusted bank statement balance matches the general ledger Cash account balance.
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To prepare the horizontal model reflecting the reconciling items as of August 31, we need to compare the bank statement balance with the general ledger Cash account balance and list the reconciling items. Here's the horizontal model:
Bank Statement Balance:
August 31 balance: $9,808
General Ledger Cash Account Balance:
August 31 balance: $9,380
Reconciling Items:
Add:
Deposit in transit: +$1,273
Deduct:
Outstanding checks: -$1,903
Add:
Interest credited by the bank: +$100
Deduct:
Bank charge for checks: -$34
Deduct:
Error in recording check payment: -$268
Adjusted Bank Statement Balance:
$9,808 + $1,273 - $1,903 + $100 - $34 - $268 = $9,976
Now the adjusted bank statement balance matches the general ledger Cash account balance.
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The Final Exami 21 8013644 Seved Dinham Kennel uses tenant-days as its measure of activity, an animal housed in the kennel for one day is counted as one enant-day. During March kennel budgeted for 4,300 tenant-days, but its actual level of activity was 4.340 tenant days. The kennel has provided the following data concening the formulas used in its budgeting and its actual results for March Data used in budgeting: Fixed element per month Variable element per tenant-day $ 35.20 Revenue $0 Wages and salaries Food and supplies $ 3,200 $ 8.20 14.70 2,200 Facility expenses 8,700 3.70 7,200 0.10 Administrative expenses. Total expenses $ 21,300 $ 26.70 Actual results for March Revenue $ 140,230 $ 28,620 Wages and salaries $ 66,350 Food and supplies $ 24,110 Facility expenses Administrative expenses $ 7,182 The spending variance for food and supplies in March would be closest to choice 20136.38 ive expenses $ 7,102 The spending variance for food and supplies in March would be closest to: Multiple Choice O $940 F $940 U $352 F $352 U
The spending variance for food and supplies in March would be closest to $352 F.
An expenditure variation is the difference between a certain expense's actual cost and its anticipated (or planned) cost.
The difference between actual and planned fixed overhead expenses is known as the fixed overhead spending variance.
Here,
Calculate the flexible budget as follows:
Flexible budget for food and supplies = Fixed expenses + (Actual activity × Variable cost per tenant day)
= $2,200 + (4,340 * $14.70)
= $2,200 + $63,798
= $65,998
Calculate the spending variance as follows:
Spending variance = Flexible budget - Actual results
= $66,350 - $65,998
= $352 (Favorable)
Therefore, the correct option is "$352 F".
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Andre and Marie are both age 26 and have two children under the age of four. The children are both too young to attend school as yet so Marie is at home with them full-time and expects to remain at home at least until the youngest child, now age two, is in school full-time when she turns five. While Marie is at home Andre is the sole family wage earner, grossing $65,000 annually, as an employee of the local school board. The family rents a midrange condominium but owns two vehicles: a new van, with a $12,000 loan outstanding and a five-year-old sedan and have $7,500 in a spousal RRSP. What is the greatest risk exposure that the couple could face in the event of the premature death of one of them? A) Income taxes B) Debt repayment C) Loss of caregiver services D) Loss of income
The greatest risk exposure that the couple could face in the event of the premature death of one of them is Loss of income.
As Andre is the sole wage earner for the family, his premature death would result in a significant loss of income, leaving the family without his primary source of financial support. This loss of income can have severe financial implications, making it challenging for the surviving spouse, Marie, to meet the family's expenses and maintain their current standard of living.
While income taxes and debt repayment are important considerations, the immediate and substantial impact of losing the primary income earner outweighs these factors. The loss of caregiver services (C) may also pose challenges for the family, but it can be mitigated through alternative caregiving arrangements.
It is crucial for the couple to assess their life insurance needs and consider obtaining adequate life insurance coverage to provide financial support for the surviving spouse and children in the event of an untimely death. Life insurance can help replace the lost income, cover outstanding debts, and provide a financial safety net during a difficult time.
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8. Agreement and disagreement among economists Suppose that Rajiv, an economist from an AM talk radio program, and Simone, an economist from a school of industrial relations, are arguing over government intervention. The following dialogue shows an excerpt from their debate: Simone: The usefulness of government intervention in the economy is a long-standing issue that economists continue to debate. Rajiv: I feel that government involvement in the economy should be reduced because government programs cause more harm than good. Simone: While I do agree that government programs can be inefficient, I really think they are necessary to help the less fortunate The disagreement between these economists is most likely due to differences in scientific judgments Despite their differences, with which proposition are two economists chosen at random most likely to agree? Lawyers make up an excessive percentage of elected officials. Minimum wage laws do more to harm low-skilled workers than help them. Tariffs and import quotas generally reduce economic welfare.
The dialogue above shows that economists have different opinions regarding government intervention in the economy. Rajiv believes that government involvement in the economy should be reduced because it causes more harm than good.
The proposition with which two economists chosen at random are most likely to agree is that tariffs and import quotas generally reduce economic welfare. This is because most economists believe that free trade promotes economic growth and that tariffs and import quotas reduce trade, which can lead to higher prices and lower economic growth.
In general, economists tend to agree on certain principles, such as the benefits of free trade, the importance of property rights, and the need for markets to be competitive. However, they may disagree on the best way to achieve these goals, and they may have different views on specific policies, depending on their ideological or theoretical perspectives.
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The audit of which of the following balance sheet accounts does not normally result in verification of an income statement account?
A) Cash.
B) Accounts receivable.
C) Property, plant, and equipment.
D) Intangible assets.
The audit of balance sheet accounts such as property, plant, and equipment and intangible assets does not typically require direct verification of income statement accounts. C is correct answer
The audit of the Property, Plant, and Equipment (PPE) account does not normally result in the verification of an income statement account.
Property, plant, and equipment are long-term assets that are used in the production or supply of goods and services. These assets are not directly linked to the income statement accounts, which typically represent revenues, expenses, gains, and losses for a specific period.
The verification of the PPE account primarily focuses on ensuring that the assets exist, are owned by the company, and are accurately recorded on the balance sheet. The audit procedures for PPE involve physical inspections, review of title documents, and examination of relevant contracts or agreements. The purpose is to confirm the existence, valuation, and ownership of the assets, as well as to assess any impairment or depreciation charges.
On the other hand, income statement accounts, such as revenue, expenses, gains, and losses, are typically verified through different audit procedures. These procedures may include testing the completeness and accuracy of revenue recognition, examining supporting documents for expenses, analyzing journal entries, and assessing the appropriateness of accounting policies and estimates.
While the audit of other balance sheet accounts like cash, accounts receivable, and intangible assets may involve verification of related income statement accounts, the audit of the PPE account does not typically result in the direct verification of an income statement account.
C is correct answer
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Hayes purchases an item of equipment on 1 February 2021 for £350,000. The item has an estimated useful life of 10 years and an estimated residual value of £20,000. It is depreciated on a straight-line basis. According to the tax authority, tax allowances for this particular item can be claimed at 25% on a reducing-balance basis. The tax rate can be taken as 30%. Hayes estimates their income tax liability at £55,000 for the year ended 31 January 2022.
Required:
Explain and justify how Hayes would account for this transaction, preparing calculations where appropriate and showing the presentation requirements as at 31 January 2022
Accounting for purchases:Hayes purchases an item of equipment on 1 February 2021 for £350,000.
The item has an estimated useful life of 10 years and an estimated residual value of £20,000. It is depreciated on a straight-line basis. According to the tax authority, tax allowances for this particular item can be claimed at 25% on a reducing-balance basis. The tax rate can be taken as 30%.In this case, the useful life of the equipment is 10 years. Therefore, the depreciation per year is:Depreciation = (Cost of equipment - residual value) / useful life= (£350,000 - £20,000) / 10 years= £33,000 per year.
The journal entry for the purchase of equipment by Hayes would be:DebitEquipment £350,000CreditCash/bank £350,000(Being the purchase of equipment by Hayes on 1 February 2021)Accounting for tax:According to the tax authority, tax allowances for this particular item can be claimed at 25% on a reducing-balance basis. The tax rate can be taken as 30%.Therefore, tax depreciation = 25% * £350,000 = £87,500.
The tax base is the cost of the asset minus the tax depreciation for the previous years. Since it is the first year, there is no tax depreciation in the previous year. Hence the tax base for the first year is the same as the cost of the asset. Therefore, the tax base for the first year = £350,000Income tax = tax base * tax rate= £350,000 * 30% = £105,000However, the estimated income tax liability for the year ended 31 January 2022 is £55,000.
Therefore, there is a deferred tax liability of £50,000(£105,000 - £55,000).Presentation requirements as at 31 January 2022:Balance sheet:Equipment £350,000Less: Accumulated depreciation (£33,000 * 1 year) £33,000Net book value £317,000Deferred tax liability £50,000Net assets £267,000Income statement:Depreciation expense £33,000Income tax expense £55,000Deferred tax expense £50,000Net income £39,000.
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Suppose the demand for goods 1 and 2 are respectively 91 = 12-P1+P2/2 and q2 = 12-p2 + p./2. No costs are incurred to produce goods 1 and 2. • Q12) Are the products A) Substitutes B) Complements • Q13) Suppose monopoly 1 produces good 1 and monopoly 2 produces good 2. Determine the profit maximizing price set by monopoly 1. Q14) Suppose a single monopoly produces both goods. Determine the profit maximizing price for good 1.
The products are Substitutes. The profit maximizing price set by monopoly 1 is $12. The profit maximizing price for good 1 is $4
Q12) The given demand equations are:
q1 = 12 – P1 + P2/2and q2 = 12 – P2 + P1/2
According to the given demand equations, if the price of good 1 increases then the quantity demanded for good 1 decreases and the quantity demanded for good 2 increases. It shows that the goods are substitutes for each other.
Therefore, the answer to Q12 is "A) Substitutes.
"Q13) Let’s consider the demand equation of good 1:
q1 = 12 – P1 + P2/2
Since monopoly 1 is the only producer of good 1, the market demand curve will be equal to the demand curve of good 1. So, the market demand curve will be:
Q1 = 12 – P1 + P2/2
Now we have the total revenue (TR) of monopoly 1 as:
TR1 = P1 × q1TR1
= P1(12 – P1 + P2/2)
Differentiating with respect to P1:
∂TR1/∂P1 = 12 – 2P1 + P2/2
The profit maximizing price (P1) is found where MR1 = MC1.
Therefore, the marginal revenue (MR1) is:
MR1 = ∂TR1/∂q1 × q1/∂q1 = P1 – q1/2
Substituting TR1 into MR1:MR1 = (12 – 3P1 + P2)/2
Equating MR1 with the marginal cost (MC1) of producing good 1 as there are no costs incurred to produce the goods:12 – 3P1 + P2/2 = 0
Multiplying by 2:24 – 6P1 + P2 = 0P2
= 6P1 – 24
Substituting P2 in the MR1 equation:
MR1 = (12 – 3P1 + 6P1 – 24)/2MR1
= (36 – 3P1)/2
Equating MR1 with MC1:36 – 3P1 = 0P1 = 12
Therefore, the profit maximizing price set by monopoly 1 is $12.
Q14) If a single monopoly produces both goods, the total revenue (TR) of the monopoly can be found by adding the total revenues of goods 1 and 2.
Therefore:
TR = P1 × q1 + P2 × q2TR
= P1(12 – P1 + P2/2) + P2(12 – P2 + P1/2)
Differentiating with respect to P1:∂TR/∂P1
= 12 – 2P1 + P2/2 + P2/2
Differentiating with respect to P2:∂TR/∂P2 = P1/2 – P2 + 12 – 2P2
Therefore, MR1 = 12 – P1 + P2/2 and MR2 = 12 – P2 + P1/2
The profit maximizing prices are found by equating MR1 and MR2 to their respective marginal costs and then solving for P1 and P2.
Since MC1 = MC2 = 0, we have:
12 – P1 + P2/2
= 012 – P2 + P1/2
= 0P1 = 6 – P2/2P2
= 6 – P1/2
Substituting P2 in P1: P1 = 4
Substituting P1 in P2: P2 = 5
Therefore, the profit maximizing price for good 1 is $4.
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How is the function of management relevant to the importance of organizational success? I need this answer with scholar reference more than 250 words
The function of management plays a crucial role in the success of an organization. Effective management practices are essential for achieving organizational goals, optimizing resources, and driving growth and innovation. This section will discuss the relevance of the function of management to the importance of organizational success, supported by scholarly references.
Firstly, the function of management provides a framework for planning and setting objectives. Planning involves defining organizational goals, determining strategies, and formulating action plans to achieve those goals. Proper planning ensures that resources are allocated efficiently, risks are managed effectively, and activities are aligned with the overall mission and vision of the organization (Daft, 2018). By establishing clear objectives and action plans, management sets the direction for the organization, ensuring that all efforts are focused on achieving desired outcomes.
Secondly, the function of management is critical for organizing resources and optimizing their utilization. Organizing involves designing the organizational structure, assigning responsibilities, and coordinating activities to achieve synergy and collaboration (Robbins et al., 2019). Through effective organizational design and structuring, management ensures that resources, including human capital, financial assets, and physical infrastructure, are allocated and utilized in the most efficient and effective manner. This leads to improved productivity, cost savings, and better utilization of the organization's capabilities and competencies.
Thirdly, the function of management encompasses leading and motivating employees. Effective leadership inspires and guides employees, fosters a positive work culture, and promotes employee engagement and commitment (Northouse, 2018). Motivated and engaged employees are more likely to be productive, innovative, and customer-focused, leading to improved performance and organizational success. Leadership also plays a critical role in managing change and facilitating organizational adaptation in dynamic and competitive environments.
Additionally, the function of management includes controlling and evaluating performance. Control mechanisms help monitor progress, assess performance against set standards, identify deviations, and take corrective actions as needed (Daft, 2018). By implementing effective control systems, management ensures that organizational activities are on track, resources are utilized efficiently, and performance is aligned with established objectives. Regular performance evaluation and feedback enable continuous improvement and learning, driving organizational success and competitiveness.
In conclusion, the function of management is highly relevant to the importance of organizational success. Effective management practices enable organizations to plan strategically, optimize resource allocation, motivate employees, and control and evaluate performance. By employing the function of management, organizations can enhance their operational efficiency, drive innovation, and achieve their goals. The scholarly references provided support the significance of the function of management in contributing to organizational success.
References:
Daft, R. L. (2018). Management. Cengage Learning.
Northouse, P. G. (2018). Leadership: Theory and practice. SAGE Publications.
Robbins, S. P., Coulter, M., DeCenzo, D. A., & Woods, M. (2019). Management. Pearson.
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6. Scuba tanks arrive at a pressure test station for testing prior to shipment. The arrival rate is 9 per hour and the station test time averages four minutes per tank. Poisson distributions are assumed. a. What is the utilization of the test station? b. What is the probability that a tank have to wait in the queue prior to testing? c. What is the mean time a tank will spend in queue? d. What is the mean time that a tank will spend in the system? e. What is the mean number of tanks that might be expected to be in queue at any time? f. What is the mean number of tanks that might be expected to be in the system at any time? g. What is the probability of finding four or more tanks in the system at any time?
The probability of finding four or more tanks in the system at any time is 0.32%.
a) To determine the utilization of the test station, we will use the following formula:
Utilization = λ/μWhere, λ = arrival rate of scuba tanks = 9 per hourμ = service rate = 15 per hour (since the average time per tank is 4 minutes, we can convert it to hours by dividing by 60)
Therefore,Utilization = λ/μ = 9/15 = 0.6 or 60%
b) Probability of a tank waiting in queue is given by the following formula:P(waiting) = λ / μ + λ
We can use the values of λ and μ from the previous question to get,P(waiting) = 9/15+9 = 0.375 or 37.5%
c) Mean time a tank will spend in the queue is given by the following formula:
E(Tq) = λ / μ (μ - λ)We can use the values of λ and μ from the previous question to get,E(Tq) = (9/15) (1/15) = 0.4 hours or 24 minutesd) Mean time a tank will spend in the system is given by the following formula:
E(Ts) = E(Tq) + 1/μ
We can use the values of E(Tq) and μ from the previous questions to get,E(Ts) = 0.4 + 1/15 = 0.4667 hours or 28 minutese) Mean number of tanks expected to be in queue at any time is given by the following formula:
Lq = λ² / μ(μ - λ)
We can use the values of λ and μ from the previous questions to get,Lq = (9/15)² / (15/9) = 0.6 tanksf) Mean number of tanks expected to be in the system at any time is given by the following formula:
Ls = λ / (μ - λ)We can use the values of λ and μ from the previous questions to get,Ls = 9/15 - 9 = 0.6 tanks
g) Probability of finding four or more tanks in the system at any time can be found using the Poisson distribution formula:
P(x >= 4) = 1 - P(0) - P(1) - P(2) - P(3)
We need to find the values of P(0), P(1), P(2), and P(3) first.Using the Poisson distribution formula:
P(x) = (e^(-λ) λ^x) / x! where x is the number of tanks in the system at any time.λ = 9/15 = 0.6 tanks/hour
P(0) = (e^(-0.6) 0.6^0) / 0! = 0.5488P(1) = (e^(-0.6) 0.6^1) / 1! = 0.3293P(2) = (e^(-0.6) 0.6^2) / 2! = 0.0988P(3) = (e^(-0.6) 0.6^3) / 3! = 0.0198
Now we can use these values to find P(x >= 4)P(x >= 4) = 1 - P(0) - P(1) - P(2) - P(3) = 1 - 0.5488 - 0.3293 - 0.0988 - 0.0198 = 0.0032 or 0.32%.Therefore, the probability of finding four or more tanks in the system at any time is 0.32%.
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A cartel, consisting of firms A and B, has allocated production such that A produces 50 units and B produces 50 units. Each firm has the following marginal cost function: B. C. A's marginal cost: MCA = 2000N) where QA is A's production B's marginal cost: MC3 = 40(Q) where Qgis B's production In order to maximize cartel (joint) profit the cartel should: A. have A produce more and B produce less. have A produce less and B produce more. maintain each firm's production at their current levels. [14] A monopolistically competitive firm can raise its price somewhat without fear of losing all its sales because of: brand loyalty. economies of scale. large market shares of firms in the market. high barriers to entry. [15] The market price under monopoly tends to be than the market price under pure competition. A. B. C. D. A. B. higher lower [16] A. B. C. D. Which of the following weaken the ability of firms to form a cartel? Firms have high inventories There are a large number of firms attempting to cooperate Firms sell a homogeneous product all of the above The Herfindahl index in the case of monopolistic competition: [17] A. B. C. D. equals 10,000 equals 0. exceeds 10,000. lies between 0 and 10,000. A. B. [18] According to the kinked demand curve model, firms expect their rivals to match any price increases (i.e., if a firm increases its price it expects all other firms to increase their prices). True False [19] In monopolistically competitive markets, firms price their product above their marginal cost. A. B. True False
A cartel, consisting of firms A and B, has allocated production such that A produces 50 units and B produces 50 units. Each firm has the following marginal cost function :A's marginal cost: MCA = 2000N) where QA is A's production B's marginal cost:
MC3 = 40(Q) where Qgis B's production In order to maximize cartel (joint) profit the cartel should maintain each firm's production at their current levels. It is the profit-maximizing point for both firms. Since the cost of production for the two firms is different, the company with a lower cost of production would have earned more profit had the companies chosen to produce a different amount of units.
As a result, a price-fixing agreement between the two firms will be reached.The monopolistically competitive firm can raise its price somewhat without fear of losing all its sales because of brand loyalty. Customers of monopolistically competitive products are usually loyal to the company due to brand reputation and advertisement.
As a result, they are willing to pay a little more for the product even if a similar product is available on the market at a lower price. Hence, a firm in monopolistic competition can charge a slightly higher price without the risk of losing all sales.In the case of monopolistic competition.
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Nguyen Corporation's common stock has a beta of 1.38. The risk-free rate is 1.78 percent and the expected return on the market is 14.6 percent. What is the cost of equity? 22.51% 21.93% 17.69% 20.15% 19,47%
The cost of equity for Nguyen Corporation's common stock with given content loaded data can be calculated using the Capital Asset Pricing Model (CAPM)
formula.
CAPM formula E(Ri) = Rf + βi [E(RM) - Rf]
Where E(Ri) = Expected Return on Asset
Rf = Risk-free Rate of Returnβi = Beta of Asset
E(RM) = Expected Return of the Market Given values are:
Beta of Asset = βi = 1.38
Risk-free Rate of Return = Rf = 1.78%
Expected Return of the Market = E
(RM) = 14.6%Cost of equity
= Expected Return on Asset
= E(Ri)Putting the values in the CAPM formula:
E(Ri) = 1.78% + 1.38 × (14.6% - 1.78%)E(Ri)
= 1.78% + 1.38 × 12.82%E(Ri)
= 1.78% + 17.6856%E(Ri)
= 19.4656%
≈ 19.47%Therefore, the cost of equity is 19.47% (approx).
Hence, option E) 19.47% is the correct answer.
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Discussion Topic: Knowing Accounting If you don't take up accounting as your chosen profession, is there any advantage or value to knowing how accounting works? What if you're planning on being a businessperson, manager, or owner? Please explain,
Yes, even if you don't take up accounting as your chosen profession, there is value to knowing how accounting works, especially if you're planning on being a businessperson, manager, or owner.
Here are a few reasons why:Understanding financial statements: As a business owner or manager, it's essential to know how to read and interpret financial statements, including the balance sheet, income statement, and cash flow statement. These statements will provide you with insights into the company's financial health, growth, and performance. Knowing accounting will help you understand these statements and use the information to make informed business decisions.Managing finances: As a business owner or manager, you'll be responsible for managing your company's finances. Knowing accounting will help you understand how to budget, analyze financial data, and prepare financial reports. You'll also be better equipped to work with accountants and financial professionals on your team.Communicating with stakeholders: Accounting is the language of business, and knowing accounting will help you communicate with stakeholders, such as investors, lenders, and customers. You'll be able to explain your financial statements and data and build trust with your stakeholders by showing that you understand your business's financial health.Analyzing investment opportunities: As a business owner or manager, you'll need to make decisions about investments in the company. Knowing accounting will help you analyze investment opportunities, calculate the potential return on investment, and assess the risks involved.In summary, knowing how accounting works can be beneficial, even if you don't take up accounting as your chosen profession. It will help you understand financial statements, manage finances, communicate with stakeholders, and analyze investment opportunities.
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- Based on the following information, which is the correct amount for the Payout Ratio?
a) 15%
b) 20%
c) 25%
d) 40%
e) 60%
- Based on the following information, which is the correct amount for Return on Common Stockholder’s Equity?
Net income: $ 600,000
Preferred dividends: $ 200,000
Cash dividends on common stock: $ 150,000
Average common stockholder’s equity: $ 1,000,000
a) 15%
b) 20%
c) 25%
d) 40%
e) 60%
The correct amount for the payout ratio is 25% and the correct amount for Return on Common Stockholder’s Equity is 40%.
Payout ratio is the percentage of earnings distributed as dividends. To determine the correct payout ratio, we need to divide the dividends paid by the net income.
The formula for calculating payout ratio is: Payout ratio = Dividends paid / Net income
To determine the correct amount for the payout ratio, we can use the following information:
Dividends paid: $150,000
Net income: $600,000
Payout ratio = Dividends paid / Net income= $150,000 / $600,000= 0.25 or 25%
To determine the correct amount for Return on Common Stockholder’s Equity, we can use the following formula:
Return on Common Stockholder’s Equity = (Net income - Preferred dividends) / Average common stockholder’s equity
Using the provided information, we can calculate the Return on Common Stockholder’s Equity as follows:
Net income: $600,000
Preferred dividends: $200,000
Cash dividends on common stock: $150,000
Average common stockholder’s equity: $1,000,000
Return on Common Stockholder’s Equity = (Net income - Preferred dividends) / Average common stockholder’s equity= ($600,000 - $200,000) / $1,000,000= $400,000 / $1,000,000= 0.4 or 40%
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What is the return on common stockholders' equity based on the following: Beginning Common Stockholders' Equity: $2,000,000 Ending Common Stockholders' Equity: $2,200,000 Net Income: $362,500 Preferred Stock throughout the year: 8%, $50 par (10,000 shares authorized and outstanding). A 15.4% B 18.1% C 19.0% D 14.3%
The return on common stockholders' equity is 18.1%. So, the correct option is B.
To calculate the return on common stockholders' equity, we need to consider the net income attributable to common stockholders and the average common stockholders' equity throughout the year. The formula for return on common stockholders' equity is:
Return on Common Stockholders' Equity = (Net Income - Preferred Stock Dividends) / Average Common Stockholders' Equity
In this case, the net income is given as $362,500. We need to deduct the preferred stock dividends before calculating the return on common stockholders' equity. The preferred stock dividends can be calculated as the preferred stock outstanding multiplied by the dividend rate. Given that the preferred stock has a par value of $50, with 10,000 shares authorized and outstanding, and a dividend rate of 8%, the preferred stock dividends would be $4,000 (10,000 shares * $50 par value * 8% dividend rate).
Now, let's calculate the average common stockholders' equity. The beginning common stockholders' equity is $2,000,000, and the ending common stockholders' equity is $2,200,000. Therefore, the average common stockholders' equity is ($2,000,000 + $2,200,000) / 2 = $2,100,000.
Plugging the values into the formula:
Return on Common Stockholders' Equity = ($362,500 - $4,000) / $2,100,000 ≈ 0.1771
Multiplying this value by 100, we get 17.71%. Rounded to one decimal place, the return on common stockholders' equity is approximately 18.1% (Option B).
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What Are The Three Different Ways To Break Down The Percentages In A Contingency Table?
What are the three different ways to break down the percentages in a contingency table?
The three different ways to break down the percentages in a contingency table are:
Row percentages: Row percentages calculate the percentage distribution within each row of the contingency table. It shows the proportion of each category in a row relative to the total count in that row. This breakdown helps in understanding the distribution of one variable across the levels of another variable.
Column percentages: Column percentages calculate the percentage distribution within each column of the contingency table. It shows the proportion of each category in a column relative to the total count in that column. This breakdown helps in understanding the distribution of one variable within each level of another variable.
Total percentages: Total percentages calculate the percentage distribution across the entire contingency table, considering all rows and columns. It shows the proportion of each category relative to the total count in the contingency table. This breakdown helps in understanding the overall distribution of the two variables together.
These three breakdowns provide insights into the relationship between two categorical variables in a contingency table, highlighting the distribution patterns and associations between the variables.
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The quality of a service can be improved through a(n) _____.
360-degree feedback system
customer perception analysis
survey
employee improvement plan
gap analysis
The quality of a service can be improved through a gap analysis. Gap analysis is a systematic approach used to identify the gaps or differences between the desired service quality and the actual service performance.
Gap analysis involves comparing customer expectations with the actual service delivery and identifying the gaps in terms of knowledge, skills, processes, resources, or other factors that may be contributing to the gap. Once the gaps are identified, organizations can develop strategies and implement changes to bridge those gaps and enhance the quality of the service.
While other methods such as a 360-degree feedback system, customer perception analysis, surveys, and employee improvement plans can also contribute to improving service quality, the specific focus of this question is on identifying the method that directly addresses the improvement of service quality. Gap analysis specifically targets the identification and closure of gaps, making it a suitable approach for improving service quality.
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Why not because If they decide to pursue a non-asset based growth strategy, then they will only be able to acquire smaller companies with great products but lack a lot of resources.
Should the Wheels Group pursue a non-asset-based growth strategy or an asset-based strategy? Why or why not?
This would be beneficial for both the acquiring firm and the acquired firm since it would give them access to many more resources than either firm would have access too on their own.
It's urgent
The decision of whether the Wheels Group should pursue a non-asset-based growth strategy or an asset-based strategy depends on various factors.
If the company has limited resources but wants to acquire smaller firms with great products, a non-asset-based strategy may be suitable. This approach allows the Wheels Group to leverage the strengths and innovations of the acquired firms without the need for significant investments in physical assets. It can provide access to new markets and technologies while minimizing upfront costs.
However, if the Wheels Group has the financial means and wants more control over the supply chain, an asset-based strategy could be considered. Acquiring companies with substantial assets can provide economies of scale and operational efficiencies.
Ultimately, the decision should align with the company's long-term goals, market opportunities, and competitive landscape. Conducting a thorough analysis and seeking expert advice can help determine the most appropriate growth strategy for the Wheels Group.
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Effective planning by managers helps accomplish which step in the control process?
Group of answer choices
Comparing actual performance with objectives and standards.
Establishing performance objectives and standards.
Measuring actual performance.
Evaluating the results of corrective action.
Correct option is (b). Effective planning helps the managers to develop performance objectives and standards. Performance objectives are the results that an organization seeks to attain and standards are the quality, quantity, time, or cost specifications that are intended to determine whether objectives have been achieved or not.
Effective planning by managers helps to accomplish establishing performance objectives and standards step in the control process. The control process has four significant steps which are:
1. Establishing performance objectives and standards.
2. Measuring actual performance.
3. Comparing actual performance with objectives and standards.
4. Evaluating the results of corrective action.
Effective planning helps the managers to develop performance objectives and standards. Performance objectives are the results that an organization seeks to attain and standards are the quality, quantity, time, or cost specifications that are intended to determine whether objectives have been achieved or not. Once the objectives and standards are set, the management team uses them to measure actual performance, which helps them to compare it with the set standards and objectives.
The management team can evaluate the results of corrective action taken by comparing actual performance with objectives and standards, which is the final step in the control process. Effective planning is an important part of the control process. It helps the managers to develop performance objectives and standards. Performance objectives are the results that an organization seeks to attain and standards are the quality, quantity, time, or cost specifications that are intended to determine whether objectives have been achieved or not. Once the objectives and standards are set, the management team uses them to measure actual performance, which helps them to compare it with the set standards and objectives.
Effective planning helps the management team to focus on the organization's goals and objectives, enabling them to identify potential problems and obstacles that could prevent them from achieving their goals. It also helps them to develop contingency plans, which are alternative courses of action that can be taken if the initial plan fails. The control process has four significant steps which are establishing performance objectives and standards, measuring actual performance, comparing actual performance with objectives and standards, and evaluating the results of corrective action. Effective planning helps accomplish the first step of the control process, which is establishing performance objectives and standards.
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Efficiency Due Thursday by 11:59pm Points 100 Submitting an external tool Question The market for electricity is in equilibrium as seen in the graph below. Assume legislation was passed placing a price ceiling on electricity at $0.11 per kWatt. The sum of which two areas represents the lost social surplus (deadweight loss) from this price ceiling? Please use the variables from the image in your answer (and not numeric calculations). Price (per kWh in USD) 0.19 0.15 0.11 M N P R 3000 Market for Electricity O Q 4000 5000 S D Quantity (in bivors of Kn)y Provide your answer below: social surplus loss
The electricity market is in equilibrium as demonstrated by the graph below. Assume a law was passed which capped the cost of electricity at $0.11 per kWatt. What is the combined value of the two areas that represents the missed social surplus (deadweight loss) caused by this cost ceiling?
The price ceiling of $0.11 per kWatt will cause a shortage of electricity since demand is greater than supply at this price point. Because of the price ceiling, the quantity supplied will be lower than the quantity demanded, resulting in a lack of electricity. The price ceiling will result in deadweight loss, which is the total surplus that is lost as a result of the price ceiling (P*Q1) minus the total surplus that would have been created if the market were allowed to operate freely (P*Q2).According to the graph below, at a price of $0.11 per kWatt, the quantity demanded of electricity is Q2, while the quantity supplied is Q1, resulting in a lack of electricity. The total surplus in the market before the price ceiling was imposed was (A + B + C). After the price ceiling was imposed, the new total surplus is (A), which represents the consumer surplus. The lost social surplus due to the price ceiling is (B + C).Therefore, the sum of the two areas B and C represents the total deadweight loss or missed social surplus due to the price ceiling.
The missed social surplus (deadweight loss) from the price ceiling is represented by the sum of the two areas, B and C.
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1. Suppose the reserve ratio requirement is 30% and there is an increase in bank excess reserves of $50 million a. Calculate the money multiplier. Show your work. b. What is the total amount of additional deposits created by this initial increase in bank excess reserves? Show your work. c. Explain based on your calculations in part b the meaning of the money multiplier d Suppose the Federal Reserve decreases the reserve ratio to 20%. Calculate the new money multiplier and show your work. Explain why the money multiplier increased or decrease as a result of the higher reserve ratio.
The reserve ratio decreases, the amount of excess reserves held by the bank increases, which, in turn, leads to an increase in the money supply generated by each dollar of the bank's excess reserves.
a) Calculation of Money Multiplier in the given scenario: Here, the reserve ratio requirement is 30%, and the bank has an excess reserve of $50 million.
So, it can be calculated as follows :Money multiplier = 1 / reserve ratio Money multiplier = 1 / 0.3Money multiplier = 3.33Therefore, the money multiplier is 3.33.
b) Calculation of the total amount of additional deposits created by this initial increase in bank excess reserves: The total amount of additional deposits created by this initial increase in bank excess reserves is the product of the money multiplier and the excess reserves of banks.
Total additional deposits created = Money multiplier x Excess reserves Total additional deposits created = 3.33 x $50 million Total additional deposits created = $166.5 million Therefore, the total amount of additional deposits created by this initial increase in bank excess reserves is $166.5 million.
c) Explanation of the meaning of the money multiplier based on calculations in part b:From the above calculations, it can be interpreted that the money multiplier determines the amount of money supply generated by each dollar of the bank's excess reserves. The value of the money multiplier in this scenario is 3.33, which means that the bank can create $3.33 of deposits from each dollar of excess reserves it has.
d) Calculation of new money multiplier and explanation of the increase or decrease in the money multiplier as a result of the higher reserve ratio: When the Federal Reserve decreases the reserve ratio to 20%, the new money multiplier can be calculated as follows: Money multiplier = 1 / reserve ratio Money multiplier = 1 / 0.2Money multiplier = 5Therefore, the new money multiplier is 5. The money multiplier increases when the reserve ratio decreases.
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Assume six firms composing an industry have market shares of 30, 30, 10, 10, 10, and 10 percent. The Herfindahl index for this industry is Multiple Choice
a. 2,200.
b. 2,000.
c. 80.
d. 1,600.
To calculate the Herfindahl index for the industry, we need to square the market shares of each firm and sum them up.
Market shares:
Firm 1: 30%
Firm 2: 30%
Firm 3: 10%
Firm 4: 10%
Firm 5: 10%
Firm 6: 10%
Squaring the market shares:
Firm 1: (0.3)^2 = 0.09
Firm 2: (0.3)^2 = 0.09
Firm 3: (0.1)^2 = 0.01
Firm 4: (0.1)^2 = 0.01
Firm 5: (0.1)^2 = 0.01
Firm 6: (0.1)^2 = 0.01
Summing up the squared market shares:
0.09 + 0.09 + 0.01 + 0.01 + 0.01 + 0.01 = 0.22
Finally, to obtain the Herfindahl index, we multiply the sum by 10,000.
Herfindahl index = 0.22 * 10,000 = 2,200
Therefore, the Herfindahl index for this industry is 2,200. The correct answer is (a) 2,200.
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The following tables show the production possibilities frontier for Fiji and Canada. Using this information make the following calculations: Canada's Production Possibilities Tomatoes (tons) 10,000 and 0 7500 and 2,500 5000 and 5,000 2500 and 7,500 0 and 10,000 Mexico's Production Possibilities Tomatoes (tons) Wheat (tons) 100,000 and 0 75000 and 250 5:00 50000 and 25000 and O and 750 1,000 a. Opportunity Cost of Tomatoes in Canada & Mexico b. Opportunity Cost of Wheat in Canada & Mexico Wheat(tons) c. Suppose Canada & Mexico specialize in only producing what they are best at making. Calculate the total amount of wheat & tomatoes produced by the two countries under this scenario.
The total amount of wheat and tomatoes produced by the two countries under this scenario is 25,000 and 100,000 respectively.
Given tables show the production possibilities frontier for Fiji and Canada.Canada's Production Possibilities Tomatoes (tons) 10,000 and 0 7500 and 2,500 5000 and 5,000 2500 and 7,500 0 and 10,000
Mexico's Production Possibilities Tomatoes (tons) Wheat (tons) 100,000 and 0 75000 and 25000 50000 and 25000 25000 and 50000 0 and 100,000
a. Opportunity Cost of Tomatoes in Canada & Mexico, the opportunity cost of tomatoes in Canada & Mexico is as follows:
Canada's Opportunity Cost of Tomatoes (OC_C)OC_C = Δ Wheat/Δ Tomatoes= (25000 – 0) / (7500 – 0)= 25000 / 7500= 3.33
Mexico's Opportunity Cost of Tomatoes (OC_M)OC_M = Δ Wheat/Δ Tomatoes= (25000 – 0) / (100000 – 0)= 25000 / 100000= 0.25
b. Opportunity Cost of Wheat in Canada & Mexico:Canada's Opportunity Cost of Wheat (OC_C)OC_C = Δ Tomatoes/Δ Wheat= (7500 – 0) / (25000 – 0)= 7500 / 25000= 0.3
Mexico's Opportunity Cost of Wheat (OC_M)OC_M = Δ Tomatoes/Δ Wheat= (100000 – 0) / (25000 – 0)= 100000 / 25000= 4
c. Suppose Canada & Mexico specialize in only producing what they are best at making. Calculate the total amount of wheat & tomatoes produced by the two countries under this scenario
.We can determine the total amount of wheat and tomatoes produced by the two countries by comparing their opportunity costs. Canada should specialize in producing wheat while Mexico should specialize in producing tomatoes because they have lower opportunity costs for these goods.
This would lead to the following specialization: Canada specializes in producing Wheat Mexico specializes in producing TomatoesAs, given data, Canada's Production Possibilities are:
Tomatoes (tons) 10,000 and 0 7500 and 2,500 5000 and 5,000 2500 and 7,500 0 and 10,000
Here, Canada's best specialty is Wheat which is produced at (25000, 0).
So, the amount of wheat produced is 25,000 tons, and the amount of tomatoes produced is 0.
Mexico's Production Possibilities are: Tomatoes (tons) Wheat (tons) 100,000 and 0 75000 and 25000 50000 and 25000 25000 and 50000 0 and 100,000
Here, Mexico's best specialty is Tomatoes which are produced at (0, 100,000). So, the amount of tomatoes produced is 100,000 tons, and the amount of wheat produced is 0.
Hence, the total amount of wheat and tomatoes produced by the two countries under this scenario would be:
Total amount of wheat = 25,000
Total amount of tomatoes = 100,000
Therefore, the total amount of wheat and tomatoes produced by the two countries under this scenario is 25,000 and 100,000 respectively.
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Investors are often critical to the success of a new venture and a new venture will have a better chance of getting those early stage investments if the venture seems to align with what investors look for. What do they look for, and specifically how are their interests addressed in the very first steps of forming a new venture? Explain how what investors look for is strongly correlated with the BMC.
Answer:
Investors look for certain key aspects in a new venture before deciding to invest. These aspects can be strongly correlated with the Business Model Canvas (BMC), a strategic management tool used to outline and analyze a business model.
Explanation:
The following are some elements that investors commonly consider:
Market Opportunity: Investors want to see a clear market opportunity for the venture. The BMC's "Customer Segments" and "Value Proposition" sections help articulate the target market and the unique value the venture offers.
Scalability and Growth Potential: Investors seek ventures with the potential for rapid growth and scalability. The BMC's "Key Partnerships," "Key Activities," and "Revenue Streams" sections help demonstrate how the venture can scale and generate revenue.
Competitive Advantage: Investors look for ventures that have a competitive advantage over existing solutions. The BMC's "Key Resources" and "Key Activities" sections help identify and highlight the venture's unique resources, capabilities, or value proposition that set it apart.
Team: Investors consider the quality and experience of the founding team. The BMC's "Key Partnerships" and "Key Activities" sections can showcase the team's expertise, partnerships, and network.
Revenue Model: Investors assess the revenue model and potential profitability of the venture. The BMC's "Revenue Streams" section provides insights into the revenue generation strategy and potential monetization avenues.
Cost Structure and Financial Viability: Investors analyze the cost structure and financial viability of the venture. The BMC's "Cost Structure" section helps outline the cost elements and efficiency measures.
By addressing these investor interests, the early steps of forming a new venture can align with the BMC. The BMC provides a framework to articulate and evaluate these crucial aspects, allowing entrepreneurs to present a compelling case to investors. It helps in identifying and refining the value proposition, target market, revenue streams, cost structure, and key resources and activities. Through this alignment, entrepreneurs can increase their chances of attracting early-stage investments by demonstrating a clear understanding of the market, scalability, competitive advantage, and financial viability of their venture.
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