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r-ruslan [8.4K]
3 years ago
9

In 2008, OPEC succeeds in raising world oil prices by 300 percent. This price increase causes inventors to look at alternative s

ources of fuel for internal-combustion engines. A hydrogen-powered engine is developed which is cheaper to operate than gasoline engines. Which problem in the construction of the CPI does this situation represent?
a. substitution bias and introduction of new goods
b. introduction of new goods and unmeasured quality change
c. unmeasured quality change and new goods.
d. income bias and substitution bias
Business
1 answer:
djverab [1.8K]3 years ago
7 0

Answer:

Option "A" is the correct answer to the following statement.

Explanation:

  • In Industries, when the price of one manufacturing factor increase, then Inventors try to create new better and cheap substitution for that factor.

In Substitution bias, a customer needs a cheaper and better substitution for the substitute goods.

In the same manner, when new goods come into the market as substitution goods then the market of these new goods rapidly rises.

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In the short run, a supply shock will _________ the equilibrium level of prices and ___________ the equilibrium level output. re
Taya2010 [7]

Answer: raise; reduce

Explanation:

A Supply shock is described as a situation where the supply of a good changes suddenly/ abruptly due to an unforeseen event.

Supply shocks can be positive but are usually negative so we will assume the supply shock is negative here.

If there is a negative supply shock, the amount of goods being produced will reduce abruptly which will force the supply curve to shift left.

It will then intercept the the demand curve at an equilibrium level that has a higher price and a lower quantity of output.

Think of it this way. Negative supply shock ⇒ less goods ⇒ scarcity ⇒ higher prices.

5 0
3 years ago
The expected rates of return on portfolios A and B are 11% and 14%, respectively. The beta of A is 0.8 and the beta of B is 1.5.
Zigmanuir [339]

Answer:

Portfolio B has a higher return but more volatile stocks. However it depends on how the individual can tolerate risks.

Explanation:

Expected return= free return + Beta (Expected rate of return – risk free rate)

Portfolio A

6%+ +.8*6%

= 6%+4.8%= 10.8%

Portfolio B

6%+1.5(6%)

6%+9%= 15%

It depends on different factors. Portfolio B has a higher return but more volatile stocks. However it depends on how the individual can tolerate risks.

4 0
3 years ago
How can dishonest behavior affect your career
mr_godi [17]
I can get you caught up in a lot of lies
3 0
3 years ago
Read 2 more answers
A
Vesnalui [34]

Answer:

D. secured loan

Explanation:

"A secured loan is a loan backed by collateral"

[A. unsecured loan is a loan that doesn't require any type of collateral.]

[B. credit card ...no]

[C. property loan is a secured loan that is sanctioned keeping an asset as mortgage with the lender.]

[D. secured loan is a loan that is backed by collateral]

8 0
2 years ago
Gordon Company reports the following information at the current fiscal year end of December 31: Common Stock, $0.10 par value pe
telo118 [61]

Answer:

$0.71

Explanation:

Calculation to determine What was the average selling price for the common stock issued

Using this formula

Common stock issued avarage selling price=

Paid-in Capital in Excess of Par-Common÷Common Stock par value per share

Let plug in the formula

Common stock issued avarage selling price=($600,000+$98,000)/($98,000÷$0.10)

Common stock issued avarage selling price=$698,000/$980,000

Common stock issued avarage selling price=$0.71

Therefore the average selling price for the common stock issued is $0.71

3 0
2 years ago
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