Considering the situation described above, if country A has a comparative advantage in producing good X over country B, then: <u>the domestic opportunity cost of producing X in country A is lower than in country B.</u>
<h3>What is Opportunity Cost?</h3>
Opportunity cost is often used in economics to describe the profit lost when one choice or option is taken over another.
<h3>What is Comparative Advantage?</h3>
Comparative Advantage is the term used to describe the economy's capacity to produce a specific good or service at a lower opportunity cost than its trading competitors.
Therefore, given that country A has a comparative advantage in producing good X over country B, this equates to country A having a lower opportunity cost than country B.
Hence, in this case, it is concluded that the correct answer is option C.
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Answer:
The two organizations that Michael most likely belongs to are the AFP and AMA. AFP and ACS. AMA and AIA. AIA and ACS. 2.
Explanation:
Answer: D. 500
Explanation:
The Economic Order Quantity (EOQ) refers to an efficient number of units that a company should order to minimize the total costs of inventory such as holding costs, order costs, and shortage costs.
It is calculated by the formula below,
EOQ = √ (2 * Annual demand * Ordering Cost / Holding Cost)
EOQ = √ (2 * 5,000 * 250 /10)
EOQ = 500 units.
The economic ordering quantity (EOQ) for this item is 500 units.
Answer:
The correct answer is letter "A": True.
Explanation:
Term loans are those where individuals or organizations request a certain amount of money from a financial institution with the promise the individual or institution will be in charge of a series of periodical payments (principal + interest) to cover the debt.
<em>Term loans are privately negotiated between borrowers and lenders, offering the advantage of speed because there is no need for filings with the Securities and Exchange Commission (SEC) or other regulatory entities to request them.</em>
Answer:
The question is missing the options which are below:
A Real risk-free rate differences.
B Tax effects.
C Default risk differences.
D Maturity risk differences.
E Inflation differences.
The correct answer is option C,default risk differences.
Explanation:
Default risk is the increase in return given to an investor to compensate the investor for the likely losses that may arise due to the inability of the borrower to make funds available to the investor on the maturity date or even in required amount.
Different debt instruments have different default risk depending on their credit rating as rated by international rating agencies.Such rating is a function of many factors,which includes:
Balance sheet position
Profitability
Liquidity strength of the company
Macro-economic factors and some others.
Liquidity refers to the ability of the company to settle obligations such as repayment of bonds and interest when due.
Invariably,liquidity has a higher impact in determining credit rating as well as default risk of an instrument.
