Answer:
B) We can say that the firm is maximizing profit in the short run
Explanation:
A rational producer is at profit maximising equilibrium where : Marginal Revenue = Marginal Cost.
When MR > MC, profit is increasing & it is beneficial for firm to expand output. When MR < MC, it is loss making & it is beneficial for firm to decrease output.
If at 500 units of output : MR = MC, firm is maximising profit in short run.
Answer: $0 equipment, $20,000 land, $30,000 inventory, $90,000 partnership interest.
Explanation: The asset basis in the partnership between Xena and Xavier is the same same their basis. In the scenario above, Xena's basis is the same as Xena's partnership basis in asset.
Xena's asset basis include;
Cash = $20,000
Land basis = $40,000
Inventory basis = $30,000
Equipment basis = $0
Therefore Xena's basis in the partnership interest :
$(20,000 + 40,000 + 30,000 + 0) = $90,000
Answer:
George buys 5 bags of cookies each month
Explanation:
Given
(per gallon)
(per bag)
Required
Determine the number of bags of cookies he buys
First, we need to determine the marginal utility of cookies
To solve this, we make use of the following formula:
Substitute values for
<em>MU of Milk = 4</em>
<em>Cost of Milk = 2</em>
<em>Cost of Cookies = 4</em>
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This gives:
From the given table:
The corresponding bags of cookies for marginal utility of 4 is 5
Hence:
George buys 5 bags
Answer:
D) There is no contract.
Explanation:
The main requirements for a legal contract to exist is that:
- there is something of consideration being exchanged (in this case $ and the armoire).
- there is an offer and acceptance, and all parties involved must decide freely (in this case there is only an offer, but there is no acceptance).
- all the parties involved must be capable of engaging in a contract (e.g. no minors nor mentally disabled)
- the consideration must be legal, e.g. a contract for buying drugs is not a valid contract
