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3 years ago

True or False:If the price of a product goes up by 10% and the quantity demanded goes up by 20% the product is an inferior good.

1 answer:

5 0

False.

If the price of a product goes up by 10% and the quantity demanded goes up by 20% the product is a GIFFEN GOOD.

An inferior good is a good that decreases in demand if income increases. These are the goods that people opt not to buy when their purchasing power increases.

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The Jackson-Timberlake Wardrobe Co. just paid a dividend of $2.15 per share on its stock. The dividends are expected to grow at

tekilochka [14]

Answer:

$34.4

$37.20

c) $59.57

Explanation:

Given:

Dividend paid = $2.15

Growth rate = 4% = 0.04

Required return = 10.5% = 0.105

Now,

a) Present value = $\frac{\textup{Dividend paid}\times\textup{(1 +growth rate)}^n}{\textup{(Required return-Growth rate)}}$

for the current price n = 1

thus,

Current price = $\frac{\textup{Dividend paid}\times\textup{(1+growth rate)}^n}{\textup{(Required return-Growth rate)}}$

= $\frac{\textup{2.15}\times\textup{(1 +0.04)}^1}{\textup{(0.105-0.04)}}$

= $34.4

b) Price in 3 years

i.e n = 3

= $\frac{\textup{Dividend paid}\times\textup{(1 +growth rate)}^n}{\textup{(Required return-Growth rate)}}$

= $\frac{\textup{2.15}\times\textup{(1 +0.04)}^3}{\textup{(0.105-0.04)}}$

$37.20

c) Price in 15 years

i.e n = 15

= $\frac{\textup{Dividend paid}\times\textup{(1 +growth rate)}^n}{\textup{(Required return-Growth rate)}}$

= $\frac{\textup{2.15}\times\textup{(1 +0.04)}^{15}}{\textup{(0.105-0.04)}}$

= $59.57

4 0

3 years ago

In its first month of operations, Cheyenne Corp. made three purchases of merchandise in the following sequence: (1) 185 units at

Dimas [21]

Answer:

a. $1,375

b. $1,240

Explanation:

FIFO method

FIFO assumes that the inventory to arrive first will be sold first. Inventory values depend on earlier purchases

Inventory = 185 x $5 + 75 x $6

= $1,375

LIFO method

LIFO assumes that the inventory to arrive last will be sold first. Inventory values depend on recent purchases

Inventory = 130 x $7 + 55 x $6

= $1,240

7 0

3 years ago

Valuation of a swap during its life will least likely involve the:

crimeas [40]

Valuation of a swap during its life will least likely involve in the application of the principle of no arbitrage.

Swap involves two individual that exchanging properties or money. This individual use different tools for the exchange as desired by them.

Arbitrage allows for sale of goods or property at the highest asking price and valuation will most like involve in it.

Therefore, valuation of a swap during its life will least likely involve in the application of the principle of no arbitrage

Learn more on swap below,

brainly.com/question/22298763

#SPJ12

3 0

2 years ago

A customer purchased a $2, 700 item at Appliance World, paying with a credit card. Appliance World is charged a 2% fee by the cr

dalvyx [7]

Answer:

Explanation:

Credit card is one of the most common way of making payment while a customer purchases anything in the market. The credit card company charge an amount that is payable by the seller.Thus, it is an expense for the one selling the product.

Given:

Credit card fee: 2%

Sales = $2,700

Credit card charges can be calculated as:

Credit card charges = Sales*Credit card fee

Credit card charges = $2,700*2%

Credit card charges = $54

Now, credit card charge is an expense so it will be debited. The amount is yet to be received so accounts receivable will also be debited. The revenue has been earned so it will be credited.

Thus, the journal entry for the given transaction has been attached below:

4 0

3 years ago

EAPs are designed to affirm all of the following except

Anton [14]

Answer:

c. monitored employees are better employees

Explanation:

EAP stands for employee assistance program. It basically creates a help for employees which are facing any kind of personal or professional problems in their life.

It is a self initiated program to help the employees, by providing guidance, solving grievances or by any other means.

It nowhere assures that the employees shall be continuously monitored, while they perform and that the employees shall be set free to work in the manner they desire, as long as the company is achieving the targets.

6 0

3 years ago