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Lyrx [107]
3 years ago
12

In response to the financial crisis that began in 2007, the government began to bail out banks deemed "too big to fail." Critics

of this action argued that this would create the prospect of future bailouts and encourage banks to be fiscally irresponsible in the future. This illustrates
Business
1 answer:
Vlad1618 [11]3 years ago
8 0

Answer:

The moral hazard problem

Explanation:

Moral hazard problem is defined as a situation where a party gets involved in a risky venture knowing that another party will incur the cost of failure.

For example if a borrower knows that he can take borrowed funds and default easily, he will tend to not pay back because the lender will bear the loss.

During the the financial crisis that began in 2007, the government began to bail out banks deemed "too big to fail."

This created fiscal irresponsibility in banks that knew if they are at risk of failing they will be bailed out by the government.

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A change in the relative price of one good versus another will cause a change in marginal product and the allocation of labor re
kakasveta [241]

Answer:

The correct answer is: increase relative to Industry B.

Explanation:

The marginal revenue product measures the conribution of each additional unit of input employed in the production process. It is calculated as the product of price of product and marginal product of input.

The profit maximizing level of wage is when the marginal revenue product of labor is equal to wages.

Suppose there are two goods, A and B respectively.

When the price of good A increases relative to good B, the marginal revenue product of labor employed in production of good B will increase as well.

This will cause the wage rate of those workers to increase in comparison to workers in industry B.

4 0
3 years ago
Degregorio Corporation makes a product that uses a material with the following direct material standards:
dimaraw [331]

Answer:

Materials quantity variance = $2,350 F

Explanation:

Given:

Standard quantity = 3.7 kilos per unit

Standard price = $5 per kilo

Unit produced = 6,300

Total material = 23,780

Computation:

Materials quantity variance = (Actual quantity × Standard price) - (Standard quantity × Standard price)

Materials quantity variance = (23,780 × $) - (6,300  × 3.7  × $5)

Materials quantity variance = $118,900 - $116,550

Materials quantity variance = $2,350 F

3 0
3 years ago
In pure competition, producers compete exclusively on the basis of
erastova [34]
<span>In pure competition, producers compete exclusively on the basis of p</span>roduct features.
3 0
3 years ago
Read 2 more answers
SKRAM Corporation is appealing directly to the shareholders of IDNIC Corporation to acquire shares of IDNIC stock. This appeal i
soldi70 [24.7K]

Answer:

A hostile takeover with IDNIC corporation as the target company.

Explanation:

Since SKRAM is appealing directly to shareholders of IDNIC to acquire stocks of IDNIC corporation, it means they have a target of getting them to have a certain percentage of ownership in IDNIC because owning a stock in a company means having a percentage of ownership in that company.

This kind of appeal can be likened to trying to an aggressive push to make the shareholders take over the IDNIC corporation.

5 0
3 years ago
Haven Company uses the percentage of receivables method for recording bad debt expense. The accounts receivable balance is $600,
Katena32 [7]

Answer:

Debit Bad debt expense   $19,000

Credit Allowance for doubtful debt   $19,000

Explanation:

When a company makes sales on account, debit accounts receivable and credit sales. Based on assessment, some or all of the receivables may be uncollectible.  

To account for this, debit bad debit expense and credit allowance for doubtful debt. Should the debt become uncollectible (i.e go bad), debit allowance for doubtful debt and credit accounts receivable.

Where a debit that had previously been determined to have gone bad gets settled, debit cash and credit bad debt expense.

Amount that may be uncollectible

= 4% *  $600,000

= $24,000

Given that the Allowance for Doubtful Accounts has a $5,000 credit balance before adjustment, the additional amount to be adjusted for

= $24,000 - $5,000

= $19,000

7 0
3 years ago
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