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erik [133]
2 years ago
6

Which of the following is an example of the free-rider problem? a. Both Zoe and Zach receive low-cost dental care at the local d

ental school, so neither of them pays the full cost of the care. b. Alfred receives a free lunch from the local "Meals on Wheels" program because of his low monthly income. Yet his next door neighbor, Alice, is not eligible for the free lunch. c. Bruce owns Buster, a large dog who barks whenever anyone walks near his house. Betty lives next to Bruce, and Buster's barking can be heard whenever anyone walks near her house, too. Thus, Betty receives free protection from burglars because of Buster's barking. d. Sam purchases a burger at a fast food restaurant and gets a second burger free because the restaurant is having a buy one, get one free sale.
Business
2 answers:
Fittoniya [83]2 years ago
7 0

Answer:

c. Bruce owns Buster, a large dog who barks whenever anyone walks near his house. Betty lives next to Bruce, and Buster's barking can be heard whenever anyone walks near her house, too. Thus, Betty receives free protection from burglars because of Buster's barking

Explanation:

Free rider is a form of market inefficiency that occurs when people benefit from a good or service but do not pay or underpay for the product.

Betty is receiving free protection from Bruce's dog.

I hope my answer helps you

Reptile [31]2 years ago
5 0

Answer:

Which of the following is an example of the free-rider problem? Option C is the most suitable answer - Bruce owns Buster, a large dog who barks whenever anyone walks near his house. Betty lives next to Bruce, and Buster's barking can be heard whenever anyone walks near her house, too. Thus, Betty receives free protection from burglars because of Buster's barking.

Explanation:

In a situation whereby one party benefits without having to pay for the transaction themselves, and rather the other party pays for it, there would be an occurrence of the free-riding problem.

In the scenario described in the question, the neighbor is receiving benefits from burglars without having to pay for the security or dog.

Therefore, option C is the most suitable answer.

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You plan to retire in 19 years. At the point of retirement, you want to be able to withdraw 32,877 at the end of each year forev
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Since no any further contributions will be made to the retirement fund, the amount you need today is $172,014.

<h3>Calculation of Present Value and Present Value of a Perpetuity</h3>

The first step is to calculate the present value (PV) of the contribution at the point of retirement in 19 years using the formula for calculating the present value (PV) of perpetuity as follows:

PV in 19 years = CF / R ............................................. (1)

Where;

PV in 19 years = Present value (PV) of the contribution at the point of retirement in 19 years = ?

CF = Cash flow or yearly expected withdrawal = $32,877

R = Rate of return after retirement = 5.02%, or 0.0502

Substituting the values into equation (1), we have:

PV in 19 years = $32,877 / 0.0502 = $654,920.3187251

The amount you need today can be calculated using the present value formula as follows:

PV = FV / (1 + r)^n ……………………………………………. (2)

Where;

PV = Present value or the amount you need today = ?

FV = Future value or PV in 19 years = $654,920.3187251

r = rate of return prior to retirement = 7.29%, or 0.0729

n = number of years = 19

Substituting the values into equation (2), we have:

PV = $654,920.3187251 / (1 + 0.0729)^19 = $654,920.3187251 / 3.80737505803714 =  $172,013.607470218

Rounding to the nearest dollar, we have:

PV = $172,014

Therefore, the amount you need today is $172,014.

Learn more about present value here: brainly.com/question/17322936.

3 0
2 years ago
Cost Behavior Prepare income statement in two formats Farnsworth Drycleaners has capacity to clean up to 7,500 garments per mont
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Answer:

(1)

Fees revenues 42,600

Total expenses 1.92 x 4260  = 8179.2

<em>Net income 34,420.8</em>

<em>(2)</em>

Fees revenues 42,600

Variable cost  2,982

Contribution Margin 39,618

Fixed Cost 14,400

Net Income 25,218

Explanation:

(1)

We multiply by the garment cleaned

10 x 4,260 = 42,600

0.7 x 4,260 = 2982

and distribute the fixed cost among the normal capacity

14,400 / 7,500 = 1.92 fixed cost per garment cleaned

.7 + 1.92 = 2.62 cost per garment

(2)

We do not include the fixed cost in the unit cost, we subtact them completely as an expense.

8 0
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Name the parties involved in insurance?
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Answer:

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Policy Owner.

Beneficiary.

Insurance Company.

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Answer:

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If the IAR is not a registered broker-dealer, then NASAA rules state that oral agreements are valid for up to 10 business days, but the IAR must have a written authorization after that time expires. I.e. the IAR could buy the stocks, but he/she was not authorized to sell them. So any loss is responsibility of the firm that employs the IAR.

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Answer:

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