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3 years ago

If an externality is present resulting in market failure then

1 answer:

8 0

Then the private benefit from consumption will will not be the same as the social benefit from consumption.

An externality is the impact of a buy or choice on a man group who did not have a choice in the occasion and whose interests were not considered. Externalities, at that point, are overflow impacts that fall on parties not generally engaged with a market as a maker or a buyer of a product or service. Externalities can be negative or positive, and externalities can come about because of either the production or the utilization of a good, or both.

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The company's wacc is 10. 5%. what is the irr of the better project? (hint: the better project may or may not be the one with th

Simora [160]

The better Project is Project S having a NPV of $17.968 and IRR of 12.10 %

IRR:

An approach to capital budgeting that is used to assess the profitability of a project is the discounted payback time. Internal rate of return is one of these capital planning strategies (IRR).
This rate of return corresponds to the point at which a project's net present value equals zero. Since it does not account for any outside forces, such as inflation, they call it internal.

The calculator's capabilities will be utilized to determine the IRR,

Project S

CF0 = (1,000)
CF1 = 882.62 & F01 = 1
CF2 = 250 & F02 = 1
CF3 = 15 & F03 = 1
CF4 = 5 & F04 = 1
I = 10.5%
[NPV] [CPT]
The NPV is $17.968
[IRR] [CPT]
The IRR will come as 12.10%
Project L
CF0 = (1,000)
CF1 = 0 & F01 = 1
CF2 = 260 & F02 = 1
CF3 = 420 & F03 = 1
CF4 = 732.87 & F04 = 1
I = 10.5%
[NPV] [CPT]
The NPV is $15.78
[IRR] [CPT]
The IRR will come as 11.03%
The better Project is Project S having a NPV of $17.968 and IRR of 12.10%

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7 0

2 years ago

10. ___________ segmentation differentiates among heavy users, medium users, light users, and nonusers of a specific product, se

Papessa [141]

Answer: Rate of usage segmentation differentiates among heavy users, medium users, light users, and nonusers.

Explanation:

Rate of usage segmentation helps to divide the consumers based on the usage rate of the products. The consumption level of the consumers differs from one another.

Groups can be divided as heavy users, medium users, light users, and nonusers. By dividing them into groups the organizations are able to concentrate on heavy users rather than light users.

This is to maximize their profits the usage pattern of the consumers are also studied. Based on the usage pattern the companies change their products to be more user friendly.

7 0

3 years ago

LO 3 Chad's Chocolates is considering the purchase of a new candy press. The machine under consideration costs $17,550 and would

devlian [24]

Answer:

B) $(1,813)

Explanation:

Initial investment = 17,550

Annual cashflows = 2,650

Terminal Cashflow = 500

You can solve for NPV using financial calculator with the following inputs;

CF0= -17,550

C01 = 2,650

F01 (Frequency) = 19

C02 = 2,650 + 500 = 3,150

I=16%

Net present value; NPV = -1,812.879 or -1,813 rounded off to the nearest whole number.

4 0

3 years ago

If a company has excess capacity, increases in production level will increase variable production costs but not fixed production

den301095 [7]

Answer; True

Explanation;

When a company has excess capacity, it means that potentially it could produce more than it is producing at the moment. As this potential already takes into account the fixed costs, this means that given the fixed costs it currently has, more goods could be produced on those same fixed costs and they wouldn't increase.

Increasing production level would therefore only increase variable costs which rise whenever production rises as they are directly related to the production of goods.

6 0

3 years ago

Match each type of tariff with an example of its use.

Anna35 [415]

a. revenue tariff----------------a 6% tariff on oranges to provide money for the government.

Revenue tariff alludes to a set of rates planned for expanding public revenue. It can likewise be said as a tax exacted on import and fare to fund-raise for the government. Revenue tariff is any schedule or arrangement of rates or changes that are proposed to create income for the government.

b. protective tariff---------a 50% tariff on oranges to shield domestic orange growers from international competition.

Protective tariffs are tariffs that are established with the point of ensuring a domestic industry. Tariffs are likewise forced keeping in mind the end goal to raise government income, or to decrease a bothersome action. In spite of the fact that a tariff can all the while secure household industry and procure government income, the objectives of assurance and income augmentation recommend distinctive duty rates, involving a trade off between the two points.

c. retaliatory tariff-----------a 200% tariff on oranges to reply to a high tariff imposed by another country.

Retaliatory tariff refers to a tariff imposed as a methods for constraining a foreign government and expected to urge the give of correspondence benefits.

Retaliatory tariff is a tariff imposed to pressure another nation into evacuating its own tariffs or making exchange concessions.

6 0

3 years ago