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qaws [65]
3 years ago
12

Why does the free-market system require government regulation?

Business
2 answers:
Elenna [48]3 years ago
7 0
 In free-market system <span>the business is privately owned and operated, which means that it  is not owned or controlled by the government.</span>
The free-market system require government regulation, because the producers are driven by the profit motive to work against competition. Government regulation will enable and ensure fair competition and protect consumers.
solniwko [45]3 years ago
6 0

Explanation:

Although the free market has its virtues, such as the determination of the competitive price and the desired produced quantity, it can cause deepening in income inequality and poverty. This is because although it is efficient in production, distribution will not necessarily reach everyone, building exorbitant inequalities and poverty. Also, it tends to monopolies that can be harmful to consumers. Thus, regulation is needed for a better return to society.

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If investors expect a total return of 14.60%, what will be Goodwin’s expected dividend and capital gains yield in two years—that
storchak [24]

Answer:

First Expected Dividend will come in at the end of Year 3 or t=3 assuming current time is t=0.

D3 = $ 4.25, Growth Rate for year 4 and year 5 = 22.1 %

Therefore, D4 = D3 x 1.221 = 4.25 x 1.221 = $ 5.18925 and D5 = D4 x 1.221 = 5.18925 x 1.221 = $ 6.33607

Growth Rate post Year 5 = 4.08 %

D6 = D5 x 1.0408 = 6.33607 x 1.0408 = $ 6.59459

Required Return = 13.6 %

Therefore, Current Stock Price = Present Value of Expected Dividends = [6.59459 / (0.136-0.0408)] x [1/(1.136)^(5)] + 4.25 / (1.136)^(3) + 5.18925 / (1.136)^(4) + 6.33607 / (1.136)^(5) = $ 45.979 ~ $ 45.98

Price at the end of Year 2 = P2 = Present Value of Expected Dividends at the end of year 2 = [6.59459 / (0.136-0.0408)] x [1/(1.136)^(3)] + 4.25 / (1.136) + 5.18925 / (1.136)^(2) + 6.33607 / (1.136)^(3) = $ 59.3358 ~ $ 59.34

Dividend Yield at the end of year 3 = DY3 = D3 / P2 = 4.25 / 59.34 = 0.07612 or 7.612 %

Total Required Return = 14. 6 %

Therefore, Required Capital Gains Yield = 14.6 % - 7.612 % = 6.988 %

7 0
4 years ago
M6
lbvjy [14]

Answer:

45

Explanation:

8 0
3 years ago
Charging high prices to earn large profits during a time when there is little competitionrepresents a ________ strategy:________
Olin [163]

Answer:

Skimming

Explanation:

Price skimming, also known as skim pricing, is a pricing strategy used by those who face little or no competion, what normally happens is that a firm charges a high price and then gradually may need to lowes the price to attract more customers.

Price skimming is used to earn large profits especiallyn when a new product or service is introduced into the market. The pricing strategy is largely useful iwhen the firm is the first to enter the marketplace. The aim of this is to generate the large profit in the shortest time possible.

6 0
4 years ago
Read 2 more answers
Finerly Corporation sells cosmetics through a network of independent distributors. Finerly shipped cosmetics to its distributors
Evgen [1.6K]

Answer:

The amount of revenue Finerly should recognize upon delivery to its distributors is $0.

Explanation:

From the question, the following two very important points can be observed:

1. Finerly expects the distributors to be able to sell the cosmetics, but is uncertain because it has little experience with selling cosmetics of this type.

2. Finerly is committed to accepting the cosmetics back from the distributors if the cosmetics are not sold.

Since there is an uncertainty that the the distributors will be able to sell the cosmetics and Finerly is committed to accepting them back from the distributors if they are not sold, these imply that the amount of sales revenue cannot be known or reasonably estimated until when the distributors actually sell the cosmetics.

Therefore, the amount of revenue Finerly should recognize upon delivery to its distributors is $0.

8 0
3 years ago
Which of these is an example of a cash inflow?
Schach [20]

unselected increase in accounts receivable is an example of a cash inflow.

<h3>What types of cash flows are there?</h3>

In the cash flow statement's operating activities section, net income is often the first line item. This metric, which gauges a company's profitability, is calculated directly from the net profit displayed in the income statement of the business for the relevant period.

<h3>What elements have an impact on the cash flow statement?</h3>

Increasing Current Assets at All (Accounts Receivables, Prepaid Expenses, Inventory etc. taken from the Balance Sheet) Any drop in Current Liabilities that has occurred (Accounts Payable, Accrued Liabilities, Income Tax Payable etc. taken from the Balance Sheet). the operating activities' net cash flow.

<h3>Where in the financial statements does cash flow from operating activities appear?</h3>

Operating Activities Cash Flow Following the balance sheet and income statement in a company's financial statements comes a component of the Statement of Cash Flows called Cash flow from Operating Activities.

Learn more about cash outflow:

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5 0
2 years ago
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