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balu736 [363]
3 years ago
7

Discuss whether you agree with the following statement: “The problem with economics is that it assumes that consumers and firms

always make the correct decisions. But we know that everyone makes mistakes.”
Business
1 answer:
Zigmanuir [339]3 years ago
7 0

Answer:

I partially agree with the stament

Explanation:

Despite the economics establishes some theories based in people, companies and governments behavior, we can fine multiple examples where the situation is not totally adjusted to the theory. As an example, when we talk about the supply and demand theory, we suppose that if the price of a product rises, the demand is lower; even when this consumption may be true, there are people who buy this named product no matter the price rises.

We need to see the economist as a theory that defines most of the situations, in the same way it gives the general and specific lines for the development of the most efficient processes and behavior about a determined situation. We can use economics as a way to analyze a situation and take an action trying to have the best result.

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Suppose that the risk-free rate is 5% and that the market risk premium is 7%. What is the required return on (1) the market, (2)
Nesterboy [21]

Answer:

1.

r market = 0.12 or 12%

2.

r stock = 0.12 or 12%

3.

r Stock = 0.169 or 16.9%

Explanation:

The required rate of return can be calculated using the CAPM or Capital asset pricing model equation. The formula for required rate of return under this model is,

r = rRF + Beta * rpM

Where,

  • rRF is the risk free rate
  • rpM is the risk premium on market
  • r represents the required rate of return

1.

The beta of the market is always considered to be 1. Thus, the required rate of return on market would be,

r market = 0.05 + 1 * 0.07

r market = 0.12 or 12%

2.

For a stock whose beta is 1.0, the required rate of return would be same as that for market. So, the required rate of return for a stock with a beta of 1.0 is,

r Stock = 0.05 + 1 * 0.07

r Stock = 0.12 or 12%

3.

The required rate of return for a stock with a beta of 1.7 is,

r Stock = 0.05 + 1.7 * 0.07

r Stock = 0.169 or 16.9%

3 0
3 years ago
For studying demand relationships for a proposed new product that no one has ever used before, what would be the best method to
dolphi86 [110]

Answer:

the answer is D) all of the above are equally useful in this case

Explanation:

why? every company who is planing to offers a new good or product its important to know to which market you want to sell it, and the average age, either the company who had been working with the same product, perhaps more capacity of production in the same market, you have to do a market strategy to know if you are able to get into the new market.

5 0
3 years ago
You want to have $13,000 in 9 years for a dream vacation. If you can earn an interest rate of .4 percent per month, how much wil
alexdok [17]

Answer:

PV= $8,447

Explanation:

Giving the following information:

Future value= $13,000

Number of months= 9*12= 108

Interest rate= 0.4/100= 0.004 compounded montlhy

To calculate the initial investment required, we need to use the following formula:

PV= FV/(1+i)^n

PV= 13,000/(1.004^108)

PV= $8,447

7 0
3 years ago
Parents may claim a $2,000 child tax credit for a dependent child who is 22 years of age at the end of the year if the child is
Nataliya [291]

Parents may claim a $2,000 child tax credit for a dependent child who is 22 years of age at the end of the year if the child is a full-time student. The Child Tax Credit is a refundable tax benefit claimed by filing Form 1040 claim a tax credit of $2,000 per qualifying dependent child under age 17

<h3>What is Child Tax Credit?</h3>

Different nations offer parents with dependent children a tax advantage known as the child tax credit (CTC). The credit is frequently correlated with the number of dependent children a taxpayer has, as well as occasionally with their income. For instance, only families in the United States who earn less than $400,000 year are eligible to get the entire CTC. Similar to the United States, only families earning less than £42,000 a year are eligible for the tax credit in the United Kingdom.

The federal child tax credit (CTC) in the United States is a tax credit that is only partially refundable for parents of dependent children. Subject to an earned income level and phase-in, it offers $2,000 in tax relief per eligible kid (with up to $1,400 of that amount being refundable).

To learn more about Child Tax Credit from the given link:

brainly.com/question/17395659

#SPJ4

8 0
1 year ago
Organizational objectives should do all of the followinjg except
gogolik [260]
I would say be unclean, they cant be unclean
8 0
3 years ago
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