Answer:
Option E.
Explanation:
In free trade, a country with a comparative advantage in a good produces that good in the long-term. Therefore, if these people are working in an industry in which it has a higher opportunity cost i.e. it does not have a comparative advantage; they will eventually see job loss or fall in income or both. On other hand, when they purchase goods which has lower opportunity costs in foreign, they get access to these at a lower price and can purchase a higher quantity. So, these people are both harmed and benefitted by free trade.
Answer:
The moral hazard problem
Explanation:
Moral hazard problem is defined as a situation where a party gets involved in a risky venture knowing that another party will incur the cost of failure.
For example if a borrower knows that he can take borrowed funds and default easily, he will tend to not pay back because the lender will bear the loss.
During the the financial crisis that began in 2007, the government began to bail out banks deemed "too big to fail."
This created fiscal irresponsibility in banks that knew if they are at risk of failing they will be bailed out by the government.
The statement is False as when the balance sheets for the two companies are submitted to investors, they are not obligated to disclose the same amount of net fixed assets.
The Property, Plant, and Equipment classification is used to categorize fixed assets on a company's balance sheet. The cost of fixed assets is decreased on the balance sheet by depreciating them over the course of their useful lives in order to account for wear and tear. Both firms started off with $1 million worth of identical fixed assets when they first opened their doors two years ago, and neither one has sold or added any new ones. So, they are not supposed to report the same amount of fixed assets to investors since there is an absence of asset purchases.
Both current assets and fixed assets are listed on the balance sheet, with current assets intended for use immediately or for cash conversion and fixed assets for longer-term usage (more than one year).
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Because then there will be a limited amount of supplies and resources on Earth, so the value will be rare and expensive.
