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4 years ago

As the "P" the price level falls:

Business

1 answer:

Dimas [21]4 years ago

5 0

Answer:

B. households want to lend more, so the interest rate falls, making the quantity of goods and services demanded rise.

Explanation:

Money is demanded for 3 purposes : Transaction demand (for buying selling), precaution demand ( for contingencies), speculative demand (for investment gains)

As prices fall & things get cheaper, money demanded for transaction purposes fall. It leads to money being demanded more for precautionary & speculative purpose.
This implies that households would lend money more, to earn more in form of interests. However, this increase in money funds supply will reduce their price i.e their interest.
Interest rate is the opportunity cost sacrifised for money consumed. Low interest rate means low opportunity cost of money consumption. So, it will be demanded more for spending on goods & services, goods & services demand will rise.

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What is a characteristic of a successful budget? a. Inflexible b. Kept private c. Realistic d. All of the above

Alexeev081 [22]

Answer:

option C

Explanation:

In simple words, refers t the written statement that depicts the availability of funds in hand for a firm and hope they are gonna use it in future. Every organisation makes a budget so that they can use their resources in the most efficient way.

Budgets are made for the upcoming period but are based on the predictions made by the management and on the basis of past experiences. Thus, budgets should be made flexible and should be distributed to all the stakeholders as the real variable might diverge from the assumed variables. However budget should be in a realistic approach as they work as a major statement for evaluation.

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3 years ago

Read 2 more answers

Transactions that affect earnings do not necessarily affect cash. Identify the effect, if any, that each of the following transa

VLD [36.1K]

Answer:

(a) Cash reduction, no effect on net income

(b) Net income reduction, no effect on cash

(d) Cash increase, no effect on net income

(e) Cash reduction, no effect on net income

Explanation:

When items or services are exchanged for cash, these may be recognized as assets or expenses. While expenses reduce income, assets do not as it forms the exchange of one asset (cash) for another.

Considering the transactions in light of the above,

a) Purchased $100 of supplies for cash - Supplies are inventory (an asset) and would not reduce net income until it is used up

(b) Recorded an adjusting entry to record use of $20 of the above supplies. No effect on cash, entry is a reduction in supplies and recognition of cost of goods sold. As such net income reduces.

(c) Made sales of $1,200, all on account. - Sales on account are credit sales. This will be recognized as a credit to sales (increase in net income) and a debit to accounts receivable.

(d) Received $800 from customers in payment of their accounts. - To recognize this, we debit cash (increase in cash) and debit accounts receivable. This has no effect on net income.

(e) Purchased equipment for cash, $2,500 - Again, this is he exchange of cash for an asset. This has no effect on income.

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3 years ago

Sabas Company has 20,000 shares of $100 par, 2% cumulative preferred stock and 100,000 shares of $50 par common stock. The follo

RUDIKE [14]

Answer:

The correct option is C,$2.25 and $0.00.

Explanation:

The annual preferred shares dividends=20,000*$100*2%=$40,000

In the first year ,dividends of $10,000 paid would go to preferred stockholders while the common stockholders receive nothing.

In the second year,it is imperative to note that the balance of unpaid preferred stock dividends of $30,000 ($40,000-$10,000) would be paid alongside this year preferred dividends.

preferred stock dividends=$30,000+$40,000

However the $45,000 paid is not enough to settle the preferred stockholders,again,the total dividends of $45,000 would be paid to preferred stockholders

preferred stock dividend per share=$45,000/20,000=$2.25

common stock dividend per share is $0

Option C is the correct answer.

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3 years ago

At the end of the year, a company has a balance in Allowance for Uncollectible Accounts of $2,200 (credit) before any year-end a

Lapatulllka [165]

Answer: Debit Bad debt expense $7,300; Credit Allowance for doubtful accounts $7,300.

Explanation: 5% of accounts receivable of $190,000 is $9,500. Remember the credit balance in Allowance for uncollectible accounts is $2,200 prior to any adjustment and this reports to the balance sheet. To reinstate this account to the required provision for uncollectible amount of $9,500, we need to adjust for the difference (that is, $9,500 minus $2,200 existing balance), which is $7,300. <u>Then, the entries above would be recorded. </u>

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3 years ago

Burkhardt corp. pays a constant $13.50 dividend on its stock. the company will maintain this dividend for the next eight years a

kogti [31]

Answer: Burkhardt Corp.'s current share price is $69.47.

The current share price of a stock can be viewed as the present value of its expected dividends.

In this case, the stock price will be the sum of the discounted value of the dividends over each of the next eight years.

Mathematically we can express this as:

$\mathbf{Current Price = \frac{D}{(1+r)^{1}}+\frac{D}{(1+r)^{2}}+\frac{D}{(1+r)^{3}}......+\frac{D}{(1+r)^{n}}}$

Substituting the values we get,

$Current Price = \frac{13.5}{1.11^1}+\frac{13.5}{1.11^2}+\frac{13.5}{1.11^3}+\frac{13.5}{1.11^4}+\frac{13.5}{1.11^5}+\frac{13.5}{1.11^6}+\frac{13.5}{1.11^7}+\frac{13.5}{1.11^8}$

Solving the above equation we get,

$\mathbf{Current Price = 69.47}$

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3 years ago