A natural monopoly, such as a local electricity provider, is the result of long run average total costs declining continuously as output increases. The correct option among all the options that are given in the question is option "3". The initial cost of power generation and power distribution cost is high. Once the generation starts and the number of consumer increases, the average cost starts declining.
Answer:
$3800
Explanation:
Present value is the sum of discounted cash flows
Present value can be calculated using a financial calculator
Cash flow fromyear 1 to 15 = 500
I = 10%
PV = 3800
To find the PV using a financial calculator:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.
Answer:
The price of the stock is expected to be $188.16 in 1 year.
Explanation:
This can be determined as follows:
Current price of the stock = Expected next dividend / Expected return = $24.87 / 15.2% = $163.62
Expected stock price in 1 year = Current price of the stock * (100% + Expected return)^Number of year = $163.62 * (100% + 15.2%)^1 = $188.16
Therefore, the price of the stock is expected to be $188.16 in 1 year.
Answer:
Depreciation expense = $4,400
Accumulated depreciation = $13,200
Explanation:
Depreciation: The depreciation is the amount which decreases the value of the asset. It can be by obsolescence, usage, tear and wear, etc.
The annual depreciation is given i.e. $4,400 which will be charged in depreciation expense whereas the accumulated depreciation would be equal to
= Annual Depreciation × useful life
= $4,400 × 3
= $13,200
Answer:
<u><em>But where do we go from here? </em></u>
It depends on the result of more government intervention on quality life standards.
<u><em>Do we need less or more government involvement? </em></u>
It depends on the problems that need to be addressed. For example, to address problems such inequality it is mandatory that the government gets involve and create laws to prevent it. But surely for more movement of capitals there is no need of higher government involvement.
<u><em>Is it a question of the quality of that involvement? </em></u>
Yes. If government has an effective involvement there is even desirable to have its intervention but if it complicates everything then is repeled.
<u><em>Could it be smarter rather than just less? </em></u>
Yes, because it is proved that the economy acts in an effective way to good policy making.
<u><em>How can the cost of government involvement decrease?</em></u>
In this aspect it is important to mention the environmental issues in nowadasy economy. If the measurement of what is defined as "cost" is understand in the long run as conservation and balance between nature and economic explotation of resources.
