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Nataly [62]
3 years ago
14

Ben cartwright runs the wild west wax museum in carson city, nevada. the museum has been in business for 40 years and is a major

tourist attraction. the total value of themuseum's capital stock is $3.5 million, which ben owns outright. this year, the museum earned a total of $1.4 million after out-of-pocket expenses. without taking the opportunitycost of capital into account, this means that ben is earning a 40 percent return on his capital. suppose that risk-free bonds are currently paying a rate of percent to those whobuy them.6what is meant by the "opportunity cost of capital"?
Business
1 answer:
lawyer [7]3 years ago
5 0

<u>Solution and Explanation:</u>

The implicit cost of capital

Implicit cost of capital is the opportunity cost of capital which is already incurred but not reported as a separate cost/expense, Implicit cost is the cost which results from using an existing asset instead of selling or renting it.

For example when a businessman uses his/her existing land which has implicit cost of say $1000 per month but bought it for say $100 many years ago, so $1000 is its implicit cost/current market rent per month which is equal to its oppo

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Gelneren [198K]

Airlines that offer lower fares on seats shortly before a flight's departure date to fill empty seats are utilizing dynamic strategy which is a form of dynamic pricing. Real-time pricing, often known as dynamic pricing, is a highly adaptable method of determining a product's or service's price.

Dynamic pricing aims to enable businesses who offer products or services online to quickly modify prices in response to consumer demand. A pricing approach called "dynamic pricing" substitutes variable prices for fixed ones.

The fundamental tenet of the dynamic pricing model is to provide the same product to various customer segments at various costs. According to the number of individuals interested in particular products, dynamic pricing is a means to reflect changes and boost revenue .

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8 0
2 years ago
Last week, a gift shop’s employees heard their longtime store manager announce that she is leaving. Now they’ve read an announce
MissTica

Answer: Uncertainty

Explanation: In simple words, uncertainty refers to a situation under which an individual or an entity is not sure about their belief or decision regarding a particular subject matter.

In the given case, the employees of the store are unknown to the reality of how the new manager will be.

Hence from the above we can conclude that the above case demonstrates uncertainty.

               

6 0
3 years ago
The problem with bank runs is not that ____________will fail; they are, after all, bankrupt and need to be shut down. The proble
shusha [124]

Answer:

Insolvent banks;Solvent banks.

Explanation:

A bank run can be defined as a situation where bank clients or depositors make withdrawals of their money simultaneously from banks as a result of being scared or afraid the depository institution will run out of cash (bankruptcy) and become insolvent.

The problem with bank runs is not that insolvent banks will fail; they are, after all, bankrupt and need to be shut down. The problem is that bank runs can cause solvent banks to fail and spread to the rest of the financial system.

In order to counter the problem with bank runs, the Federal Deposit Insurance Corporation (FDIC) was established on the 16th of June, 1933.

Furthermore, to avoid bank runs or other financial institutions from being insolvent, the Federal Reserve (Fed) and Central banks (lender of last resort) are readily accessible and available to give monetary funds to these institutions when they're running out of money and as well as regulate their activities.

6 0
3 years ago
A 5-year corporate bond yields 9.70%. A 5-year municipal bond of equal risk yields 6.5%. Assume that the state tax rate is zero.
Roman55 [17]

Answer:

c. 32.99%

Explanation:

Risk yield = bond yield*(1 - Federal tax rate)

    6.50% = 9.70%*(1 - Federal tax rate)

1 - Federal tax rate = 6.50%/9.70%

Federal tax rate = 1 - 6.50%/9.70%

                           = 32.99%

Therefore, The federal tax rate that you are indifferent between the two bonds is 32.99%

3 0
3 years ago
O of 2<br> Fill in the Blank Question<br> A discount related to early payment is a
Tasya [4]

is a discount that buyers can receive in exchange

6 0
3 years ago
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