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sineoko [7]
3 years ago
15

Why won't a private business produce a nonexcludable public good?

Business
1 answer:
Effectus [21]3 years ago
8 0
 <span>Public goods are goods which are non-excludable (no one can be denied from using it) and non-rival (use by one wouldn't affect the consumption by another). 

Because of this, people want to use the good but not pay for it as they know, once the good is provided, they can't be excluded from using it. This is called Free riding. 

Private companies will not be able to tackle the problem of free riding as they won't know what rate to charge and how to make everyone pay. 

Govt. can, however do this easily.</span>
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Answer – Division A

 

EXPLANATION’

 

Given for last year,

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Let the company’s total revenue for last year be x

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Division A made 0.6x last year

 

Also given for last year,

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40% of x = 0.4x

Division B made 0.4x last year

 

For this year,

We are told that division A's revenue has decreased by 35%

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Division A’s revenue for this year = 0.6x – (35% of 0.6x)

= (100% of 0.6x) – (35% of 0.6x)

= (100% * 0.6x) – (35% * 0.6x)

= (100% - 35%) * 0.6x

= 65% * 0.6x

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= 0.39x

Therefore this year, Division A’s revenue is 0.39x

 

Again for this year,

We are told that division B's revenue has decreased by 5%

Last year’s revenue was 0.4x

Division B’s revenue for this year = 0.4x – (5% of 0.4x)

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= (100% - 5%) * 0.4x

= 95% * 0.4x

= 0.38x

Therefore this year, Division B’s revenue is 0.38x

 

If Division A’s revenue is 0.39x, and Division B’s revenue is 0.38x; then Division A had higher revenue this year.

4 0
3 years ago
With an unrelated diversification strategy, the types of companies that make particularly attractive acquisition targets are:A.
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Answer:

<em>.C. cash cow businesses with an excellent financial fit</em>

Explanation:

With an unrelated diversification strategy, the types of companies that make particularly attractive acquisition targets are:A. struggling companies with good turnaround potential, undervalued companies that can be acquired at a bargain price, and companies that have bright growth prospects but are short on investment capital.B. companies offering the biggest potential to reduce labor costs.C. cash cow businesses with an excellent financial fit.D. companies that are market leaders in their respective industries.E. companies that are employing the same basic type of competitive strategy as the parent corporation’s existing businesses.

Big businesses are usually the one that acquire  distressed companies /. They are called the cash cow because they are basically  business, investment, or product that provides a steady income or profit. they possess a large volume of the market share with little investment contribution to it.

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Answer:

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