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3 years ago

Which of the following statements is true? Multiple Choice

Business

1 answer:

ser-zykov [4K]3 years ago

5 0

Answer: Option D

Explanation: Accounting profit is always equals to or greater than the economic profit of an entity. This is due to the fact that, while computing accounting profit the accountant do no take implicit cost into consideration.

Whereas, economic profit is the amount of profit remaining after deducting both explicit and implicit cost.

Implicit cost refers to the cost of loosing profits by choosing one alternative over other.

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Describe at least two non-discretionary expenses that you expect to have at some point in your life.

ad-work [718]

Answer:

Non-Discretionary Expenses means payments made to third parties on account of: (a) mandatory payments of monthly debt service (but not payment of principal or interest at or after maturity) required under Loan Documents evidencing debt of the Venture or any Subsidiaries; (b) Emergency Expenses; (c) other non-

Explanation:

3 0

3 years ago

A report indicated that the average real wage in manufacturing declined by 2 percent between 1990 and 2000. If the CPI equaled 1

inn [45]

Answer:

W = $27.34

Explanation:

Given data:

Percentage Decline in average income is = 2%

CPI in 1990 1.30

CPI in 2000 is 1.69

Average nominal wage is 2000 is $35

Inflation rate is given as

Inflation rate = % Change in CPI

= (1.69 / 1.3) - 1

= 1.3 - 1 = 0.3 = 30%

Real wage = Nominal wage / Price level, hence

Percentage change in real wage = % Change in (nominal wage - inflation rate)

-2% = % Change in nominal wage - 30%

% Change in nominal wage = 28%

let nominal wage in 1990 is w

W\times 1.28% = $35

solving for W = $27.34

8 0

3 years ago

A. Explain the role labor’s productivity plays in wage determination in the competitive labor market. If productivity increases,

Dima020 [189]

Answer:

(A)Wages decrease in the long term

Explanation:

(A) The principles of supply and demand applies here.

Higher worker productivity in a particular industry implies increased demand for workers in the industry (short term effect).

Increased supply of workers implies:

1. output per worker increases, resulting in increase in supply of products in the industry. But, the laws of supply and demand comes in, because when supply increases, prices decrease.

That is, the increase in worker productivity may cause a decrease in prices resulting in a decrease in wages since the firm's revenue declined (long term effect).

2. Increase in the supply of workers in the industry with increased in productivity over workers from other industry because of initial increase in wages. This would lead to a decrease in wages because the supply of workers would exceed demand.

(B) The compensation differential is the additional amount of money that a given worker must be offered in order to motivate him to accept a given undesirable job, relative to other jobs that the worker could perform.

For example, when consumers want more of a particular good or service eg clothing, more firms in the industry will want workers that make this product.

6 0

3 years ago

Suppose that the price of basketball tickets at your college is determined by market forces. Currently, the demand and supply sc

belka [17]

Answer:

a) see attached graph. There is nothing unusual with the supply curve, it is simply fixed. This happens to most services, e.g. there is a fixed number of hotel rooms available for rent, in the short run you cannot add more rooms per night if the demand increases. In order to increase the quantity supplied, you would need to build a larger hotel, or in this case, a larger stadium.

b) the equilibrium price is $8 and the equilibrium quantity is 8,000 tickets

c) if the college plans to increase enrollment, the demand might increase, leading to a higher equilibrium price, but the supply will remain the same until the stadium is expanded.

Explanation:

Price Quantity Demanded (Qd) Quantity Supplied (Qs)

$4 10,000 8,000

$8 8,000 8,000

$12 6,000 8,000

$16 4,000 8,000

$20 2,000 8,000

3 0

3 years ago

Briefly describe the differences among international bond, bank and equity markets. Would you support an MNC that favors financi

Katen [24]

Answer:

Answer to this question is explained below in detail.

Explanation:

This question is not complete. This has two parts a) and b). Part a) is complete and b) is incomplete. I have written down the complete question and will try to answer completely.

a) Briefly describe the differences among international bond, bank and equity markets.

b) Would you support an MNC that favors financing through bonds issues or would you rather support one that favors financing through stock issues?

Solution:

a) We are asked to differentiate between international bond, bank and equity markets.

All three terms are related to raising funds, lending or borrowing to raise the capital for some government or for any company.

Let's start with International Bonds first.

International Bonds : In this globalized world, a company can raise its capital through getting debt in the form of international bonds from international institutions over the assets value of the company. For example: XYZ company has a asset value of 10 million dollars, so it can get international bonds accordingly.

International Equity markets: Again due to interlinked world, companies and institutions all over the world can invest their funds in any company around the globe. And through equity markets companies can sell their shares to raise its capital depending upon the asset value of the company.

International Banks: International banks are international institutions which raise capital in particular country and have branches all over the world. It can lend funds to companies on particular interest rates. Furthermore, all those bonds are generated in these banks as well.

b) Supporting an MNC that favors financing through bonds issues or through equity markets or stock issues will depend on the debt/equity ratio of the company. If it is low, company should go for debt or bond issues. If it is high then it should opt for stock issues.

6 0

3 years ago