Transfer payments are included in the latter category of government spending but not the former.
What takes place when the government cuts back on spending?Declining government spending tends to slow economic growth since less is bought by the government from the private sector. Increasing tax revenue has the tendency to decrease economic activity since it lowers people's disposable income and, consequently, causes them to spend less on products and services.
How does the economy respond to an increase in government spending?According to Keynesian economics, more government spending enhances aggregate demand and consumption, which leads to increased production and a quicker recovery from recessions.
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galla incorporated is a competitive product market. the expected selling price is $395 per unit, and galla’s target profit is 20% of the selling price. using the target cost method, the highest that galla’s cost per unit can be is:
When using the target cost method , the highest that Galla's cost per unit could be is $ 316
How to find the cost per unit ?The Target cost method allows a company to produce a unit of a good based on the cost that they would like to produce that good at . This cost would be decided upon based on the selling price of the company , and the amount of profit that a company would like to make from that selling price per unit.
The highest that Galla Incorporated would like to be their cost per unit would be :
= Targets sales price - Target Profit
Target sales price = $ 395
Target profit = ( 20 % x 395 ) = $ 79
The highest cost per unit is :
= 395 - 79
= $ 316
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Wayne is planning to sell the twenty-room apartment building he bought fifteen years ago, for which he paid $759,000. the real estate market in his area has been falling since that time, and the property has decreased in value by 3.8% every year. wayne rents each of his apartments for $495 per month, and upkeep on the building costs him $26,400 annually. assuming that wayne has kept his apartment complex constantly three-quarters full, what will his net profit or loss be when he sells the building, to the nearest hundred dollars? a. $61,500 loss b. $722,400 loss c. $168,000 profit d. $606,000 profit please select the best answer from the choices provided a b c d
When Wayne sells the building, his net profit will be about $606,000 (assumed he has kept his apartment complex consistently three-quarters filled).
Revenues Per Year: What Do They Mean?The total amount of money a business earns each year through the sale of all of its products, services, assets, and capital is referred to as annual revenue. We don't include in any of your costs when calculating your annual revenue. In income statements, the word "sales" is often used to denote revenue.
The sole term used is net profit.Net profit, which is the same as net income, is the amount that a business keeps after all costs have been paid. The cost of regular business operations, taxes, and depreciation are deducted from the total. The "bottom line," also known as a company's net profit, is a reliable predictor of how profitable the enterprise will be.
Initially, ascertain the annual revenue provided by:
Annual Revenue = Month's Rent X No. of Rooms X No. of months X Three-quarters
Annual Revenue = 495 X 20 X 12 X (3/4) = $89100
Total Profit = (Annual Revenue - Annual Cost) X (Number of years)
= (89100 - 26400) X 15
= $940500
Now, the following formula calculates Wayne's net profit when he sells the building:
Net Profit = Value of the building at the end of the 15th year + Total profit from renting - Cost of the building
Net Profit = 424490.38 + 940500 - 759000 = 605990.38
Net Profit = $606000 (approx.)
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Many people retain their classically conditioned fears without any conscious recollection of how or when those fears were learned. This best illustrates ________ memory.
a. implicit b. short-term c. sensory d. working e. state-dependent
Many people retain their classically conditioned fears without any conscious recollection of how or when those fears were learned. This best illustrates a. implicit memory.
In the field of psychology, an implicit memory can be described as a long-term memory in which no conscious retrieval of the old memories can be found.
Implicit memory is an unconscious type of long-term memory that shapes our current actions based on memories or events that we no longer remember.
For example, there are people who fear something or get triggered by an action although they cannot generate a conscious memory of what created the fear in them and how were these fears learned.
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omputer equipment was acquired at the beginning of the year at a cost of $56,900 that has an estimated residual value of $4,200 and an estimated useful life of 5 years. a. determine the depreciable cost. fill in the blank 1 of 1$ b. determine the straight-line rate. fill in the blank 1 of 1 % c. determine the annual straight-line deprecia
computer equipment was acquired at the beginning of the year Calculate depreciable cost as follows: Depreciable cost = Cost of the asset - Residual =$50,200-$4,300 = $45,900 Therefore, depreciation cost is $45,900
Calculate straight-line rate as follows: Straight-line rate= 100,Life of the asset=100,5 years 20% Therefore, straight-line rate is 20%, Calculate annual straight-line depreciation as follows: Cost of the asset - Residula value,Annual depreciation = Number of years = 5 years, $50,200 - $4,300 =$45,900 ,5 years = $9,180
Therefore, annual depreciation is $9,180
The depreciated cost is the value of an asset after its useful life has expired, which is reduced over time by depreciation. Because the value of an asset is constantly reduced by calculating the depreciation cost, the depreciated cost method always allows accounting records to show it at its current value.
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During 2018, Noriko paid the following taxes related to her home:
Real Estate property taxes on residence (paid from escrow account)
$ 1,800
State personal property tax on her automobile (based on value)
600
Property taxes on land held for long-term appreciation 400
What amount can Noriko deduct as property taxes in calculating itemized deductions, assuming she was under the $10,000 limit for state and local taxes, for 2018?
$400.
$1,000.
$2,400.
$2,800.
$2,800.
$1,800 + $600 +$400 = $2,800
As the state personal property tax was based on the value of her vehicle, it is a tax and not a fee, and is allowable as a deduction. The Tax Cuts and Jobs Act (TCJA) of 2017 limited the deduction for income, real estate and other state and local taxes. Beginning in 2018, the limitation for the deductibility of all state and local taxes is $10,000 ($5,000 for MFS).
If Noriko is under the $10,000 cap for state and local taxes for 2018, she can deduct $2,800 in property taxes when calculating her itemized deduction. The right response in this case is option D.
Real estate that is held by a person, a business, or another sort of legal entity is subject to property tax. Real estate ad-valorem taxes, which are viewed as regressive taxes, are the most common type of property tax. It is computed by the local government in the area where the property is situated, and the owner is responsible for paying for it.
$1,800 in real estate property taxes for a home
Her car's state personal property tax is worth $600.
$400 in property taxes for a plot of land preserved for future value
Since the state's personal property tax was calculated based on the value of her car, it qualifies as a tax rather than a charge and can be deducted.
= $1,800 + $600 +$400
= $2,800
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g applies for a policy as a standard risk after paying the initial premium. after thorough underwriting, the insurer issues the policy as a substandard risk. the issued policy represents:
g applies for a policy as a standard risk after paying the initial premium. after thorough underwriting, the insurer issues the policy as a substandard risk. the issued policy represents The insurer’s counteroffer
The statement made in response to an initial offer, which makes it clear that the previous offer was rejected, is referred to as a counteroffer. The initial offer has three options: accept the counteroffer, reject the counteroffer, or submit a new offer.
Until one of the parties accepts the other's offer, there is no binding agreement between them. These kinds of offers are frequently encountered in commercial talks, transactions, and private deals. The counteroffer is frequently used in negotiations for jobs, homes, and automobiles.
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moss county bank agrees to lend the sadowski brick company $300,000 on january 1. sadowski brick company signs a $300,000, 6%, 9-month note. what is the adjusting entry required if sadowski brick company prepares financial statements on june 30?
A company does not have to pay for expenses as they occur; rather, we should record them as they occur in journal entries so that they are recognized at the same time they occur.
Correct Response:Option D: Dr. $9,000 in interest costs;Cr.$9,500 in interest to be paid.
The following accrual entry must be made by Sadowski Brick Company on June 30:
Date Account Name Credit Debit June 30The interest on the Sadowski Brick should be paid out over the course of six months, from January to June.utilizing the equation as follows:
Interest on the note is equal to the note's face value divided by the interest rate for the entire period. The interest period is $300,000 divided by 6% over 12 months equals $9,000
Expenses that are incurred without an invoice or other documentation are referred to as accrued expenses.They are listed as current liabilities on a company's balance sheet and must be paid off within the current 12-month period.
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Full Question = Moss County Bank agrees to lend the Sadowski Brick Company $300,000 on January 1. Sadowski Brick Company signs a $300,000, 6%, 9-month note. What is the adjusting entry required if Sadowski Brick Company prepares financial statements on June 30?
A. Dr. Interest expense, $9,000; Cr. Cash, $9,000.
B. Dr. Interest payable, $9,000; Cr. Interest expense, $9,000.
C. Dr. Interest payable, $9,000; Cr. Cash, $9,000.
D. Dr. Interest expense, $9,000; Cr. Interest payable, $9,000.
Total cash disbursements for
inventory is $50,000, for
selling and administrative
expenses is $30,000, and for
a capital expenditure is
$40,000. Total cash
disbursements on the cash
budget are
$60,000.
$50,000.
$80,000.
$120,000.
$70,000.
There have been $120,000 in total cash outlays from the cash budget. The development of a cash budget alerts management to prospective financial surpluses or shortfalls.
What does the term "cash budget" mean?A prediction of a company's cash flows over a specific time period is called a cash budget. The budget under consideration may cover a week, month, quarter, or entire year. This budget is used to assess whether the organization will have sufficient funds to operate for the allotted time.
What other types of financial budgeting exist?A short-term cash budget includes projected sales revenue, major cash expenses, and significant assets and liabilities. A company's cash flow over longer time frames, like two years, is displayed in a long-term cash budget. Finance experts can use this information to make capital spending plans.
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which of the following statements are true? multiple select question. the requirements for establishing a corporation vary from state to state. corporations are subject to less regulation than proprietorships. a partnership is a separate legal entity created by the authority of a state government. a proprietorship is the simplest form of business organization to organize and operate.
By definition, a partnership business is one in which two or more people pool their resources to form a company and agree to split profits, losses, and risks.Law firms, physician groups, real estate investment firms, and accounting groups are all examples of common partnerships in business.
Which five characteristics do partnerships share?
Keep in mind that both parties should communicate, be accessible, flexible, offer mutual assistance, and produce measurable outcomes.When it comes to making your partnership agreements work best, these qualities are essential.
What is an example of a partnership?
A partnership is a contract between two or more people to manage the business and divide its assets and profits.Profits and liabilities are shared by all members of a general partnership business.Physicians and lawyers frequently form limited liability partnerships.
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Which of the following represents an aggressive approach to demand management in the service
sector when demand and capacity are not particularly well matched?
a. inexpensive rates for weekend phone calls
b. appointments
c. reservations
d. first-come, first-served
e. none of the above
Inexpensive rates for weekend phone calls represents an aggressive approach to demand management in the service sector when demand and capacity are not particularly well matched. So option a is correct option of the given statement.
Demand management: What does it mean?Planning technique called demand management. It is utilized by businesses to forecast and plan how to meet service and product demand. Connectivity between operations and marketing is improved via demand management. Customer demands, capacity, and strategy are better coordinated as a result.
What does demand management aim to achieve?In order to meet the market where it is, you must first understand the market and the demand chain. Only then can you build an operational strategy. You can develop project portfolios and use portfolio management to carry out your demand strategies after you have them.
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Which of the following REIT types is organized to acquire the specific property or properties described in its prospectus? (A) A property trust (B) A mixed trust (C) A purchasing trust (D) An exchange trust
Answer:
B
Explanation:
A purchasing trust is the type of REIT organized to acquire the specific property or properties described in its prospectus.
Companies that hold or finance income-producing real estate across a variety of property industries are known as REITs, or real estate investment trusts. In being eligible to become REITs, those realtors must fulfill a number of standards. The majority of REITs float on significant stock markets and provide investors with a number of advantages.
Real estate investment trusts, or REITs, are businesses that own and manage properties in order to make money. Companies that manage portfolios of high-value real estate properties and mortgages are known as real estate investment trust companies. For instance, they rent out properties and get paid for them. The stockholders are then given revenue and royalties from the rent that was thusly collected.
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tarzak inc. has earnings of $10 per share, and investors expect that the earnings per share will grow by 3 percent per year. furthermore, the mean pe ratio of all other firms in the same industry as tarzak is 15. tarzak is expected to pay a dividend of $3 per share over the next four years, and an investor in tarzak requires a return of 12 percent. the estimated stock price of tarzak today should be using the adjusted dividend discount model. group of answer choices $116.41 $104.91 $161.15 none of the above
The estimated stock price of Tarzak today should be using the adjusted dividend discount model is $116.41. Option A.
Solution:
Dividend for first 4 years = $3 per share
Required return = 12%
Present value of discount payments = $3/1.12 + $3/1.122 + $3/1.123 + $3/1.124 = $9.11
Present value of stock price = $168.9 / 1.124 = $107.34
Estimated stock price = $9.11 + $107.34 = $116.45
The Dividend Discount Model has some important drawbacks including a lack of accuracy. The main limiting factor of DDM is that it can only be used by companies that pay increasing dividends. DDM is also considered overly conservative as it does not take stock buybacks into account.
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consider the $400,000 estimated salvage value. is it appropriate to discount it at the same rate as the other cash flows? what about the other cash flows - are they all equally risky?
When an asset has a salvage value of $400,000, it is not appropriate to discount it at the same rate as the other cash flows, because its discounting is proportionate throughout the periods of its life. Other cash flows, on the other hand, are higher in risks.
Salvage value can be referred to or considered as the value that determines the value of an asset at the end of a particular accounting period. This salvage value is the difference between the actual costs and the amount of depreciation charged over the asset.
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The Skulls, a student social organization, has two different locations under consideration for constructing a new chapter house. The Skulls' president, a POM student, estimates that due to differing land costs, utility rates, etc., both fixed and variable costs would be different for each of the proposed sites, as follows:Location Annual Fixed VariableAlpha Ave. $ 5,000 $ 200 per personBeta Blvd. $ 8,000 $ 150 per personIf it is estimated that 30 persons will be living in this new chapter house, which location should the Skulls select?Multiple ChoiceAlpha Ave.become a virtual organization.either Alpha Ave. or Beta Blvd.Beta Blvd.reject both Alpha Ave. and Beta Blvd.
The Skulls, a student social organization, has two different locations under consideration for constructing a new chapter house. The Skulls' president, a POM student, estimates that due to differing land costs, utility rates, etc., both fixed and variable costs would be different for each of the proposed sites, the location will skull selects is alpha ave.
-Multiply the variable cost by the volume, then add that product to the fixed cost
Numerous other company categories have historically been categorized as public utilities, and as a result, have been legally required to go through the ratemaking process in order to establish the permissible service costs for their sector. Public utilities are often considered to be a de facto monopoly (or "natural monopoly") for the services they offer within a certain jurisdiction, despite the fact that this categorization has varied throughout time. Railroads, the distribution of natural gas, telecommunications, and the generation and distribution of electricity are examples of well-known public utilities that are required to determine rates through ratemaking.
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true or false: markets and private ownership of property create incentives to work hard and can contribute to growth in an economy.
It is true that markets and private ownership of property create incentives to work hard and can contribute to growth in an economy.
Private ownership of property promotes potency by giving the owner of resources an incentive to maximise its worth. The additional valuable a resource, the additional commerce power it provides the owner of the resource. this is often as a result of, during a capitalist system, somebody who owns property is entitled to any worth related to the property.
Increases in capital merchandise, labor, technology, and human capital will all contribute to growth in an economy. Economic process is often measured in terms of the rise in mass value of extra merchandise and services made, mistreatment estimates like GDP.
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agile project management works well with projects that take an iterative approach. what does this mean? select all that apply.
The manager by iterative approach means that the project deliverables improves continuously based on feedback and the team operates within many short blocks of time.
What does iterative approach mean?In an iterative approach, changes are made to the discussion topic, the stimulus, and occasionally even the methodology as the study project progresses. The inputs for later interviews are influenced by what is learned from the early research sessions.
How does iterative approach apply in the agile project management?Feedback is used to continuously enhance project deliverables.
The group works in a variety of brief time slots.
Throughout a project's life cycle, processes are frequently repeated.
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according to the taylor rule, what will the federal reserve do if output falls below its potential gdp?
Under this rule, if the economy is below full employment, the GDP gap is expressed as a negative number and interest rates should be lowered. This Taylor rule states that if actual GDP is 1% below potential GDP, the Federal Funds Rate should be 0.5 percentage points below the central bank's neutral interest rate target.
Exceeding inflation and growth targets will increase the base rate according to the Taylor rule while falling below will decrease it. The Taylor rule adjusts the equilibrium interest rate based on the deviation of inflation and real GDP growth from the central bank target.
The Taylor Rule proposes adjusting the FF rate based on the difference between actual and target inflation and the output gap (the difference between real GDP growth and expected GDP).
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mystery shoppers are always trained observers who sporadically sample the service and its delivery. t/f.
Mystery shoppers are always trained observers who sporadically sample the service and its delivery is false.
Of the various making plans strategies available, 4 fundamental ones are generally used to increase an in-depth plan for handing over the visitor experience. The equipment is blueprinting, the widely wide-spread carrier map, fishbone analysis, PERT/CPM, and simulation.
The layout day and the capability day are each principle utilized by groups to expect visitor demand. Any waiting-line version have to consist of the quantity of visitors arriving and the way lengthy it takes to serve visitors.
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You are an economic adviser using the Fed model to analyze the economy. What is the effect of a rise in the risk premium in the economy? a rise in the real interest rate, falling output, and unexpected deflation a fall in the real interest rate, rising output, and unexpected inflation a rise in the real interest rate, rising output, and unexpected inflation a fall in the real interest rate, falling output, and unexpected deflation
the effect of a rise in the risk premium in the economy is rise in the risk premium in the economy is that there will be rise in the real interest rate, falling output, and unexpected deflation.
A risky venture is naturally more profitable if successful, so the risk premium can be viewed as a real profit advantage. Investments in highly competitive markets that often give predictable results are unlikely to have a significant impact.
When economic activity slows and the stock market outlook is bleak, equity risk premiums may rise. Just as risk premiums can rise when inflation is expected to rise, changes in equity market volatility can also raise risk premiums.
Business risk, financial risk, liquidity risk, foreign exchange risk and country risk are the five main risks that make up the risk premium. All five of these risk variables can reduce returns, so investors should be paid fairly for them.
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which type of data visualization method can be helpful when the intention is to show the distribution of annual salary at the research and development department of a health tech company?
The visual cube level visualization method can be helpful when the intention is to show the distribution of annual salary at the research and development department of a health tech company.
Making graphical representations of data is referred to as data visualisation. By leveraging complex sets of numerical or factual numbers, visualisation plays a significant role in data analytics and aids in the real-time interpretation of large amounts of department. The graphical display of various information or data sets using visual components like maps, charts, and graphs is known as data visualisation. These tools should support a range of aesthetic styles, be straightforward and quick to use, and be able to handle a sizable amount of data.
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various depreciation schedules have been computed for an asset having a salvage value of $90 at the end of its recovery period. identify the type of depreciation used in each case.
The most appropriate answers is Method A for the given question.
What is depreciation?A tangible item's cost can be spread out over the period of its life span using the accounting approach of depreciation. Depreciation indicates how much of an asset's worth has been expended. It makes it possible for companies to buy assets more than a predetermined period of time and profit from those assets.
For SYOD,
Depreciation in year 1 = 970*5/(5+4+3+2+1) = 323
Depreciation in year 2 = 970*4/(5+4+3+2+1) = 259
Depreciation in year 3 = 970*3/(5+4+3+2+1) = 194
Depreciation in year 4 = 970*2/(5+4+3+2+1) = 129
Depreciation in year 5 = 970*1/(5+4+3+2+1) = 65
Hence Method A is SOYD
The methods listed in the table above include:
Method A: SOYD;
Method B: SL;
Method C: DDB-SL;
Method D: MACRS;
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what are two internal governance mechanisms put in place to align principal and agent incentives? (check all that apply.)
Strategic control and reward systems are two internal governance mechanisms put in place to align principal and agent incentives.
An agent, in legal terminology, is a person who has been legally empowered to act on behalf of every other individual or an entity. An agent can be employed to represent a consumer in negotiations and different dealings with 0.33 parties.
Section 182 of the Indian Contract Act defines the time period Agent and fundamental, as consistent with which, Agent is the character appointed by using every other individual to represent in dealings or any sort of professional paintings with a third celebration. The essential is the person who appoints the agent to represent him.
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if the natural rate of unemployment was 6 percent, the current unemployment rate was 9 percent, and potential GDP was $4.000 billion, then according to Okun's law the economy would have sacrificed Multiple Choice $240 billion in output not produced $320 billion in output not produced $360 billion in output not produced $480 billion in output not produced.
If the natural rate of unemployment was 6 percent, the current unemployment rate was 9 percent, and potential GDP A) was $320 billion in output not produced.
one of the maximum not unusual is GDP, which stands for gross domestic product. it's miles regularly noted in newspapers, on the tv news, and in reports by means of governments, central banks, and the business network. It has to turn out to be widely used as a reference factor for the fitness of national and global economies. Gross home product (GDP) is the usual degree of the cost introduced created via the production of products and offerings in a country during a positive duration. As such, it also measures the profits earned from that production or the full amount spent on the very last items and offerings (fewer imports).GDP = non-public consumption + gross non-public investment + government investment + authorities spending + (exports – imports).GDP is generally calculated by using the national statistical agency of the united states of America following the global general.
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the act that specified that workers have a right to organize unions and that management must give them a fair chance to do so is known as the:
'the act that specified that workers have a right to organize unions and that management must give them a fair chance to do so is known as the National Labor Management Relations Act of 1935.
The National Labor Relations Board is an independent agency of the U.S. federal government responsible for enforcing U.S. labor laws regarding collective bargaining and unfair labor practices.
The National Labor Relations Board is an independent federal agency that protects the right of private sector workers, unionized or not, to associate to improve wages and working conditions.
The NLRA protects workplace democracy by giving workers in private sector workplaces the fundamental right to seek better working conditions and representation without fear of reprisal.
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viman, an indian, has been assigned to his company's london office. he realizes that he does not have suitable clothes for london's harsh winter. which of the following activities in the consumer decision-making process does the given scenario illustrate?
The following activities in the consumer decision-making process in the given scenario is need recognition.
Making decisions involves selecting a course of action, acquiring data, and weighing potential answers. By gathering pertinent data and outlining options, a step-by-step decision-making process can assist you in making more careful, considered judgments.
Making decisions is crucial since it enables you to select from a variety of possibilities. It is important to acquire all relevant data and consider its advantages and disadvantages before making a decision. It is vital to concentrate on actions that can assist in making the proper selections.
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true or false: the only reason for citron to require retailers to sell electric scooters at a certain price is to reduce competition and extend its market power to the retail market. therefore, this practice is always economically inefficient.
True: the only reason for citron to require retailers to sell electric scooters at a certain price is to reduce competition and extend its market power to the retail market. therefore, this practice is always economically inefficient.
From a microeconomics standpoint, five elements—product characteristics, the number of sellers, entry obstacles, information accessibility, and information—can influence competitiveness. A monopoly exists when a business sells a singular product that no other business is offering since there is no rivalry. The degree of differentiation is mainly described by product features. For instance, if a company's product is homogeneous (identical to those already on the market), the good or service cannot be distinguished in the slightest from those offered by rivals. This scenario would indicate fierce competition.
As an alternative, a product might be totally distinct, in which case it is distinct. If this is the case, there might be few choices and little competition. The degree of distinction is mostly a question of opinion among consumers.
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you have accepted a loan in the amount of $15,000 for your new car. you have agreed to pay the loan back in four years. what is your monthly payment if you agree to pay an interest rate of 9% compounding monthly? solve this problem for i
Your monthly payment on the loan for the new car, given the interest rate, and the compounding period is $ 373. 28
How to find the monthly payment ?The monthly payment will be an annuity because it is constant and periodic.
The interest rate on this payment needs to be converted to a monthly figure as :
= 9 % / 12
= 0. 75 %
The number of periods is :
= 4 years x 12 months per year
= 48 months
The monthly payment is :
= Loan amount / Present value interest factor of annuity, 48 periods, 0.75%
= 15, 000 / 40.18478188518
= $ 373. 28
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what is the advantage for candidates in having a one-way video interview over a traditional face-to-face interview? check all that apply.
Candidates can practice answers based on a predetermined set of questions provided by the interviewer, candidates can practice and perfect their responses by rerecording, candidates can be interviewed at their leisure
Explain.
They'll probably want you to make a video of yourself, which you should then transmit to them by email or another medium they'll designate. The hiring group will watch your video after receiving it. Someone will contact you directly if they determine you are a strong contender for the position.A one-on-one interview is when a contributor is questioned individually about their actions, preferences, attitudes, and experiences related to a particular subject or object of interest Both in-person and online interviews are available.To know more about Interview here
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would some consumers be willing to accept some risk from using a product if it means the product is cheaper? why?
Some consumers would be willing to accept some risk form using a product if it mean the product is cheaper, because they are implementing trade-off concept between safety and product price.
Trade-off explains that in order to gain one thing, we have to accept of having less or even loss of something else.
In economics, trade-off is also known as opportunity cost. Opportunity cost is the cost of opportunity we missed when we decide to purchase or purse another product.
From the perspective of the uttainable triangle, we know that a product could only have 2 out of the triangle sides--speed, price, quality. You will not be able to meet all 3 aspects in one product. This theory is align with trade-off concept.
If we look back at the case, some consumers may prefer to have cheaper product even if the product's quaility is poor. Those customers are already aware with their decision's side effect and concequences, in this case is in form of product risks.
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Sandhill Co. purchased a new machine on October 1, 2025, at a cost of $67,560. The company estimated that the machine has a salvage value of $7,080. The machine is expected to be used for 72,200 working hours during its 6-year life.Compute the depreciation expense under the straight-line method for 2025 and 2026, assuming a December 31 year-end.20252026Depreciation expense under the straight-line method$enter a dollar amount$enter a dollar amount
The depreciation expense under the straight-line method for 2025 and 2026, assuming December 31 year is $10,080.
Purchase price= $67,560
Salvage value= $7,080
Useful life= 6 years
To calculate the depreciation expense under the straight-line method, we need to use the following formula:
Annual depreciation= [tex]\frac{(original cost - salvage value)}{estimated life }[/tex]
Annual depreciation= [tex]\frac{(67,560 - 7,080)}{6}[/tex]
Annual depreciation= $10,080
2025:
Annual depreciation= (10,080/12)×3= $2,520
2026:
[tex]Annual depreciation= $10,080[/tex]
In accountancy, depreciation is a term that refers to 2 elements of the identical concept: first, the actual lower of the honest cost of an asset, such as the lower fee of factory equipment every yr as its miles used and worn, and 2d, the allocation in accounting statements of the unique cost of the property.
Depreciation is thus the decrease within the price of assets and the method used to reallocate, or "write down" the price of a tangible asset (together with the device) over its beneficial existence span. businesses depreciate lengthy-time period property for both accounting and tax functions. The decrease in the fee of the asset impacts the stability sheet of a commercial enterprise or entity, and the technique of depreciating the asset, accounting-smart, affects the internet earnings, and for that reason the income assertion that they report. generally, the fee is allocated as depreciation cost among the intervals wherein the asset is anticipated for use.
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