Answer:
option b is correct answer
Explanation:
given data:
MPC = 0.75
We know that
MPC +MPS =1
So, MPS = 1 - 0.75 = 0.25
We know that tax multiplier is given as
Tax multiplier 
= 
= -3
change in taxes
Billion
therefore, tax increase by $8 billion.
option b is correct answer
Inventory costing methods rely heavily on assumptions about the flow of costs. The most widely used inventory valuation method is the FIFO method.
FIFO (First-In, First-Out), LIFO (Last-In, First-Out), Specific Identification, and Weighted Average Cost are the 4 major Inventory costing methods. If your inventory costs are steady or increasing, LIFO is the better option. Businesses with bigger inventories and rising costs appreciate how LIFO reduces profits and taxes while increasing cash flow. If your inventory costs are decreasing, FIFO is the better option.
Learn more on Inventory costing methods-
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Answer:
Find answers below.
Explanation:
Risk management can be defined as the process of identifying, evaluating, analyzing and controlling potential threats or risks present in a business as an obstacle to its capital, revenues and profits. This ultimately implies that, risk management involves prioritizing course of action or potential threats in order to mitigate the risk that are likely to arise from such business decisions.
Price risk is the risk of a decline in a bond's value due to an increase in interest rates. This risk is higher on bonds that have long maturities than on bonds that will mature in the near future.
Reinvestment risk is the risk that a decline in interest rates will lead to a decline in income from a bond portfolio. This risk is obviously high on callable bonds. It is also high on short-term bonds because the shorter the bond's maturity, the fewer the years before the relatively high old-coupon bonds will be replaced with new low-coupon issues. Which type of risk is more relevant to an investor depends on the investor's investment horizon, which is the period of time an investor plans to hold a particular investment. Longer maturity bonds have high price risk but low reinvestment risk, while higher coupon bonds have a higher level of reinvestment risk and a lower level of price risk. To account for the effects related to both a bond's maturity and coupon, many analysts focus on a measure called duration, which is the weighted average of the time it takes to receive each of the bond's cash flows.
The bonds which would have the largest duration is a 10 year - zero coupon bond.
Answer:
True
Explanation:
Fixed cost is the cost which cannot be avoided and is not dependent on level of activity thus, if there is high fixed cost than variable cost, in that case with decrease in level of output the loss will rise rapidly.
Where variable cost is more than fixed cost, then the cost will only increase or incur when there is production accordingly in case of low sale or low production the loss will also be less, as accordingly cost will be less.
Therefore, the statement in question is TRUE
Answer and Explanation:
(A) In the event that U1 = C1 and U2 = C2,
at that point two get both same utility C1 must equal to C2
C1 + C2 = 90
substituting C1 in the place of C2 in the above equation we get
2C1 = 90
C1 = 90/2
C1 = 45
C2 = 45
Each one has utility = 45
(B) U1 = U2
C1(c1/c2) = c1*c2
c1 = c2^2
c1 + c2 = 90
substituting c1 = c2^2 in c1 + c2 = 90
c2^2 + c2 = 90
c2 = 9
c1 = 81
U1 = U2 = 981 = 729
(C) U1 = u2
(C1 - 5)({c1 - 5}/{c2 + 5}) = (c1 - 5)(c2 + 5)
C1 - 5 = (c2 + 5)^2
C1 - 5 = c2^2 + 25 + 10c2
C1 = c2^2 + 30 + 10c2
90 = c2^2 + 30 + 10c2 + c2
0 = c2^2 - 60 + 11c2
C2 = 4,-15
-15 not possible C2 = 4
C1 = 90 - 4 = 86
U1 = U2 = 729
(D) Due to satisfy their principle, gift decrease the consumption of individual 2 by same amount and Increase consumption of individual 1 by same amount.
