Answer:
The correct answer is option B.
Explanation:
The changes in the exchange rate will affect those domestic firms that sell their products in the foreign market or those domestic firms that produce and sell domestically but has foreign companies as competitors.
If the exchange rate falls, the price of domestic firms will decline as compared to imports. This will create more demand for domestic goods.
If the exchange rate increases domestic goods will become costlier and imports will become cheaper. This will increase the demand for imports.
Answer: B. shifts the budget constraint outward
Explanation:
An increase in the income of a consumer will bring about an outward shift of the budget constraint. This is because when the income of a consumer rises, such consumer can buy more goods and services.
Also, a decrease in income will result into an inward shift of the budget constraint. This is because lesser goods are purchased.
Answer: $3,826
Explanation:
Discount received on terms 2/10 = (Purchase value – Cost of merchandise returned) x Discount Rate
= $4,000 - $300 x 2%
= $3,700 x 2%
= $74
if the company paid the invoice within the discount period, Then the total cost of this merchandise
Total cost of merchandise = Value of merchandise purchased– Cost of merchandise returned + Transportation Costs - Amount of discount received
= $4,000 - $300 + $200 - $74
= $3,826
Answer:
The right project will be sorted by the use of the Profitability Index.
Explanation:
Since all three capital investment proposals have a positive Net Present Value, we have to use profitability index to ascertain which project is most profitable by following the steps below.
1. Divide the N.P.V of each project by the initial investment of the project
2. Rank the answer from the highest ratio to the least.
3. The project with the highest Profitability Index is to be selected for the investment.
Answer:
a. True
Explanation:
The Activity variance is based on the difference in actual level of activity used in flexible budget and the level of activity accounted in the planning or master budget