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HACTEHA [7]
3 years ago
11

Suppose that a negative externality is created by the production of good X. Which of the following statements is correct?

Business
1 answer:
notsponge [240]3 years ago
4 0

Answer:

The answer is: A) The social cost of producing good X includes the private cost plus the cost to bystanders of the externality.

Explanation:

Negative externalities are costs suffered by third parties as a consequence of producing a certain product or service. Negative externalities are caused by the consumption of products, but the third parties damaged are no involved in the buyer-seller transaction. Social costs include production costs plus negative externalities.

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Firms in the patented pharmaceutical industry earned an average return on net worth of 22 percent in 2006, compared with an aver
IrinaVladis [17]

Answer and Explanation:

The following theories of profit best explain the profits of pharma companies:

1. Risk bearing - The theory says the higher the risk, the higher the rewards. The pharma companies take huge risks in inventing a new drug, having trials and the getting FDA approvals.

2. Monopoly - If a new drug is approved, the pharma company gets a patent over it, which means that it will have an effective monopoly on that segment of the market.

3. Innovation - it states that innovation is what keeps a company ahead. And pharma industry is built on innovation. Pharma companies have to continuously find new drugs because once patents run out on existing drugs, there are no profits to be made.

3 0
3 years ago
If $15,000 is considered to be material to the income statement, but $25,000 is material to the balance sheet, the auditor shoul
Elanso [62]

Answer:

The correct option is d.

Explanation:

It is given that $15,000 is considered to be material to the income statement, but $25,000 is material to the balance sheet.

Material to the income statement = $15,000

Material to the balance sheet = $25000

The auditor should set overall materiality according to the income statement.

The auditor should set overall materiality at $15,000.

Therefore the correct option is d.

7 0
3 years ago
What two conditions must hold for a competitive market to produce efficient outcomes?
nexus9112 [7]
Those are supply curves and demand curves. Supply curves have to meet the production requirements, while demand curves have to meet the consumer's willingness to pay.
4 0
3 years ago
The management team at Yum BBQ Brands has decided not to license its product because of concerns that this will create opportuni
Shkiper50 [21]

The choice represent internalization theory.

<h3><u>Explanation:</u></h3>

The outward movement of the operations of any firm can be defined as an internalization. Internalization is mainly carried out for the purpose of achieving advantages when a firm is located at foreign nations. This may be because there exists a larger market for a particular product in foreign nations.

Making investments at foreign regions also refers to internalization. The internalization theory of the firms that are multi nationally located has investments in intangible assets that has a public good properties. In the given example represents the internalization theory choice of economic theory.

5 0
3 years ago
A dozen eggs cost $0.96 in December 2000 and $1.82 in December 2017. The average wage for workers in private industries was $14.
pogonyaev

Answer:

the percentage in which the price of the dozen eggs rise is 89.58% or 90%

Explanation:

The computation of the percentage in which the price of the dozen eggs rise is shown below;

Percentage Change in Dozens egg price is

= (Price in 2017 - Price in 2000) ÷ Price in 2000 × 100

= ($1.82 - $0.96) ÷ $0.96 × 100

= 89.58% or 90%

Hence, the percentage in which the price of the dozen eggs rise is 89.58% or 90%

8 0
3 years ago
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