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amid [387]
3 years ago
14

Consider the market for corn. Indicate whether each of the following events will cause a shift in the demand curve or a movement

along the curve. If it will cause a shift, specify the direction. a. A drought hits corn-growing regions, cutting the supply of corn: . b. The government announces a new subsidy for biofuels made from corn: . c. A global recession reduces the incomes of consumers in poor countries, who rely on corn as a staple food (assuming corn is a normal good): . d. A new hybrid variety of corn seed causes a 15 percent increase in the yield of corn per acre: .
Business
1 answer:
Salsk061 [2.6K]3 years ago
4 0

Answer:

a) MOVEMENT ALONG THE CURVE

b) MOVEMENT ALONG THE CURVE

c) SHIFT TO THE LEFT

d) MOVEMENT ALONG THE CURVE

Explanation:

There is a MOVEMENT ALONG THE CURVE when there is a variation in the price of the good.

On the other hand, there is a SHIFT when any of the variables other than the price of the good changes (for example: the income of the consumers, the tastes of the consumers, the prices of related goods -substitutes or complementary-, the size of the market). When the curve shifts to the left this indicates a decrease in demand. When it moves to the right it indicates an increase in demand.  

a) A drought hits corn-growing regions, cutting the supply of corn. MOVEMENT ALONG THE CURVE. The decrease of the offer will cause an increase in the price, and consequently a decrease in the quantity demanded.

b) The government announces a new subsidy for biofuels made from corn. MOVEMENT ALONG THE CURVE. As a result of the subsidy, the demand for corn by biofuel manufacturers will increase, which will cause an increase in the price of corn, and consequently a decrease in consumer demand.

c) A global recession reduces the incomes of consumers in poor countries, who rely on corn as a staple food (assuming corn is a normal good). A SHIFT TO THE LEFT IN THE DEMAND CURVE. The reduction of income will cause a decrease in demand.

d) A new hybrid variety of corn seed causes a 15 percent increase in the yield of corn per acre. MOVEMENT ALONG THE CURVE. Corn supply increases and consequently the price decreases, which causes an increase in demand.

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Tony is a 45-year-old self-employed psychiatrist who has net earned income of $300,000 in 2020. What is the maximum amount he ca
Natali5045456 [20]

Answer:

Tony is a 45-year-old psychiatrist who has net earned income of $300,000 in 2020. What is the maximum amount he can contribute to his SEP for the year? 300,000x.25= 75,000 or $57,000

$57,000

Explanation:

6 0
2 years ago
Consider two stocks, A and B. Stock A has an expected return of 10% and a beta of 1.2. Stock B has an expected return of 14% and
barxatty [35]

Answer:

B; it offers an expected excess return of 1.8%

Explanation:

Here are the options :

A; it offers an expected excess return of .2%A; it offers an expected excess return of 2.2%B; it offers an expected excess return of 1.8%B; it offers an expected return of 2.4%

to determine which stock is the better buy, we have to calculate the expected return of the stocks using CAPM

According to the capital asset price model: Expected rate of return = risk free + beta x (market rate of return - risk free rate of return)

Stock A = 5% + 1.2(9% - 5%) = 9.8%

Stock B = 5% + 1.8(9% - 5%) = 12.20%

The next step is to determine the excess return

stated expected return - calculated expected return = excess return

Stock A's excess return = 10% - 9.8% - 0.2%

Stock B's excess return = 14 - 12.20 = 1.8%

Security B would be considered because it has a higher excess return

8 0
3 years ago
Myriad Solutions, Inc. issued 12% bonds, dated January 1, with a face amount of $420 million on January 1, 2021, for $375,505,45
faust18 [17]

Calculation

Period   Cash Interest   Bond Interest    Discount     Carrying  

 End          paid            Expense         Amortization     Value

 01-Jan-21                                                            $375,505,452            

30-Jun-21 $25,200,000 $26,285,38 $1,085,382 $376,590,834

1-Dec-21 $25,200,000   $26,361,358  $1,161,358  $377,752,192

Total    $50,400,000     $52,646,740

3 0
3 years ago
Read 2 more answers
An oil refinery must now begin sending its waste liquids through a costly treatment process before discharging them. The enginee
WARRIOR [948]

Answer:

Option A is the cheapest.

Explanation:

Giving the following information:

The engineering department estimates costs of $450,000 for the first year. It is estimated that if process and plant alterations are made, the waste treatment cost will decline $43,000 each year. As an alternative, a specialized firm, Hydro-Clean, has offered a contract to process the waste liquids for 15 years for $225,000 per year.

We need to use the following formula and chose the smallest net present value:

NPV= Io +∑ [Cf/(1+i)^n]

Option A:

Io= 407,000

Year cost= 43,000

NPV= 734,061

Option B:

Yearly cost= 225,000

NPV= 1,936,368

7 0
3 years ago
Consider the relationship between the AE curve and the AD curve. A rise in the amount of desired​ consumption, investment, gover
Rudiy27

Answer:

The response options are:

B) real national income and AE.

C) AD and real national income.

D) the price level and desired consumption.

E) the price level and the equilibrium level of demand-determined national income.

The correct answer is: E) the price level and the equilibrium level of demand-determined national income.

Explanation:

Aggregate demand is the total planned or desired expenditure in the economy as a whole in a given period. It is determined by the aggregate price level and by factors such as investment, public spending and money supply.

COMPONENTS OF THE ADDED DEMAND:

Consumer expenses of domestic economies. It is the main component of aggregate demand.

Investment expenditure of companies or domestic economies. It refers to the increase in the physical capital stock, including the accumulation of stock of companies.

Purchases of goods and services for public service. Component

important, includes, for example, national defense expenses, salaries of officials, infrastructure, construction, etc.

Foreign demand (international trade). They are net exports exports - imports). It is a component of the total demand for the goods of an economy. The trade flows of a country are an engine that drives the economy to better product levels.

7 0
3 years ago
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