That is true because has most likely asked for higher than the offer.
Answer:
Lenders loose and borrowers gain
Explanation:
Whenever inflation increases the value of money falls and technically erodes interest rates (hence real interest rate falls although nominal rate stays the same)
In the scenario, if the inflation rate rises to 5.5%, then the real interest rate falls further from 1.5% to (5.75% - 5.5%) 0.25%, demonstrating that the lender is loosing further.
Contrarily, the borrower will technically be paying lesser interest to the lender because he will be paying lesser money in value to the lender both in terms of interest and principal
There are numerous reasons, things like war, immigration, increased poverty, or things like unpredictable natural disasters. When a hurricane strikes and destroys entire cities and housing it has to be fixed quickly and that is spending that was not planned since you can't expect things like that. Wars often cost much more than what was planned because bad things happen and they need to be fixed. Immigration can lead to an increase in social welfare spending since not all immigrants find a job quickly and establish themselves in the society.
Answer:
Minimum selling price is $ 37
Explanation:
Computation of minimum selling price
Direct materials per unit $ 15
Direct labour per unit - existing $ 19
Additional for modification <u>$ 3</u>
Direct Labor per unit <u>$ 22</u>
Variable cost per unit $ 37
Since the Company has sufficient idle capacity to produce the additional order, no incremental fixed manufacturing capacity is considered.
The minimum selling price should be one which covers the variable costs ( modified for labor increase)
