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1 year ago

Which two lines intersect at level of output the firm is supplying if that business is earning zero economic profits?

1 answer:

4 0

The average cost curve and the variable revenue curve are two lines which intersect at level of output when the firm is supplying and that business is earning zero economic profits.

If the price which the firm is charging from customer is higher than its average cost of production for the quantity of the goods produced, then the firm will earn profits to a large extent.

Conversely, if the price which is charged by the firm is lower than its average cost of production, the firm will suffer losses.

Thus when the cost is equal to the revenue of the firm it means there is no profit at all. At this level the average cost curve will intersect the revenue curve.

To know more about marginal cost curve here:

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ohnstone Company is facing several decisions regarding investing and financing activities. Address each decision independently.

Vesnalui [34]

Answer:

Johnstone should value the equipment at $40,326.29.

Explanation:

To determine this, the present value of the five annual installments of $8,000 is first calculated using the formula for calculating the present value of an ordinary annuity as follows:

PV = P * ((1 - (1 / (1 + r))^n) / r) …………………………………. (1)

Where;

PV = Present value of the five annual installments =?

P = Annual payment = $8,000

r = interest rate = 10%, or 0.10

n = number of years = 5

Substitute the values into equation (1) to have:

PV = $8,000 * ((1 - (1 / (1 + 0.10))^5) / 0.10)

PV = $8,000 * 3.79078676940845

PV = $30,326.29

Therefore, the present value of the five annual installments of $8,000 is approximately $30,326.29.

As result of this:

Value the equipment = Payment on the purchase day + present value of the five annual installments = $10,000 + $30,326.29 = $40,326.29

Therefore, Johnstone should value the equipment at $40,326.29.

7 0

3 years ago

According to U.S. GAAP, asset retirement obligations are ________.

Vika [28.1K]

Answer:

D) long-term legal requirements to restore property

Explanation:

5 0

2 years ago

Assume that the interest rate on borrowings in south korea is 1 percent, but the interest rate on deposits in british banks is 7

Vikentia [17]

The trader involved is in carry trade.

Further Explanation:

Carry Trade: It is defined as a strategy that is used in trading which involves borrowing money at a lower rate of interest and investing in an asset that gives a higher rate of return. It involves borrowing money in a currency that is having a low rate of interest and convert the borrowed sum of money into other currency. The amount is then placed in a deposit in the currency that offers a high-interest rate. It invests in the assets like bonds, stocks, real estate, or commodities that are designated in the other currency.

The two risks that are involved in carry trade are the risk of decline in the price of the assets in which investment is made and exchange risk. This is common in the Foreign exchange market.

Therefore, the trader is involved in carry trade.

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Answer details:

Grade: High School

Subject: Economics

Chapter: Types of trade

Keywords: the interest rate, South Korea, 1 percent, deposits in British banks, 7 percent, a trader, 1 million South Korean won, British pounds, deposits in a British bank, carry trade, trade involved in, FX market.

5 0

3 years ago

Corporations report which of the following in a separate section of the income statement?A. cost of goods sold.B. income tax exp

Gemiola [76]

Answer:

B. Income Tax Expenses

Explanation:

The Purpose of the Income Statement in Financial Statement Preparation is to ascertain the profit or loss of a business entity for a particular year. Usually, the format is as follows:

1. Gross Profit= Sales- Cost of Goods sold(Opening Inventory + Purchases- Closing Inventory)

2. Net Profit/ Net Loss = Gross Profit + Other Revenues and Gains - Expenses for the period.

However, income tax expense is only calculated when the net profit has been ascertained. It is usally referred to as net income before tax. It is based on this figure, that the income tax expense is then calculated based on prevailing income tax percentage.

Every other part of the income statement covers a section, but all sections should be calculated and concluded before the income tax expense can be calculated and then subtracted to arrive at the final income tax.

5 0

3 years ago

All currencies are worth exactly the same. Question 45 options: True False

ycow [4]

Answer:

False!

Explanation:

that's why they are different sizes, material, and weight!

Some american dollars are worth alot more than a dollar in say, mexico. Our resources are more valuable.

Glad I could help!

6 0

3 years ago

Read 2 more answers