Answer:
<em>Brian prevails because the product has a warranty for some months or years.</em>
Explanation:
Therefore, <em>Ibtiha, though did not know about the defectiveness of the Ice Cream Maker sold to Brian is bound by law to replace or repair the defect device depending on what was contained in the warranty.</em>
<em />
A warranty is a type of guarantee, usually a written guarantee for a product, that a manufacturer or similar party makes regarding the condition of its product. It also refers to the terms and situations in which repairs or exchanges will be made if the product does not function as originally described or intended.
However, a warranty holds the maker of the product responsible to repair or replace a defective product or its parts, thereby Brian prevails as Ibtihal will be made to comply with the provisions of the warranty.
Answer:
E) bowed out shape of the production possibilities frontier.
Explanation:
The production possibilities frontier curve is usually has a bowed out shape because as the production of one of the products increases, the opportunity cost of producing the other product also increases.
As shown in the attached image, as the production of Y increases, the opportunity cost of producing X will also increase, giving the curve a bowed shape. The same happens to the opportunity cost of producing Y when the production of X increases.
Answer:
$46,000
Explanation:
We can find out the the revaluation gain that need to be reported at the year end by just deducting the the cost of the investment by its current fair value .
DATA
Fair value = 588,000
Cost = 542,000
Revaluation gain = Current fair value - Cost
Revaluation gain = 588,000 - 542,000
Revaluation gain = $46,000
The revaluation gain of $46,000 will be reported in other compreensive income of smith's financial statements.
Answer:
The value of the stock today is $20
Explanation:
Using the CAPM equation, we first calculate the required rate of retunr on the stock.
The equation for CAPM is,
r = rRF + Beta * rpM
Where,
- rRF is the risk free rate
- rpM is the risk premium on market
- Beta * rpM is the risk premium on stock
r = 0.05 + 0.04
r = 0.09 or 9%
The value of the stock can be calculated using the zero growth model of DDM. The DDM values the stock based on the present value of the expected future dividends from the stock. As the dividend from the stock is expected to remain constant through out to an indefinite period, the value of the stock today is,
P0 = Dividend / r
P0 = 1.8 / 0.09
P0 = $20
