Answer:
It is characteristic of CAPITAL goods that they are not used up in the short run. A society can choose to SACRIFICE some quality of life now BY PURCHASING fewer consumer goods ANS SAVING MONEY in order to build up its stock of capital goods. This will lead to a HIGHER QUALITY OF LIFE and more consumer goods PURCHASED AND CONSUMED later on.
Explanation:
A consumer can choose between saving and spending money, that is measured by the marginal propensity to consume or the marginal propensity to save. Money that is spent now, will provide a certain satisfaction in the present, but nothing in the future. Money saved will not provide a certain satisfaction in the present, but should provide much more satisfaction in the future since it should grow as time passes.
Answer:
B. The denial is justifiable given the level of interbrand competition.
Explanation:
Anti trust law only applicable if you can proof that two or more producers in the same industry work together in order to assert their control over the market. They can do this through price fixing, controlling the amount of supply, etc.
This condition<em> can't be found</em> in the scenario above.
The denial that done by PepsiCo is justifiable because in a really competitive market, a company need to impose a strict requirement on which entities they should form a dealership relation with. If PepsiCo choose the wrong dealers, Its competitors could easily taken over the market and resulted in a huge amount of loss for the company.
Answer:
Income Statement Dec. 31, 20Y6
<u> Glacier Travel Service </u>
Total revenue $900,000
- Wages expense ($425,000)
- Rent expense ($180,000)
- Utilities expense ($75,000)
- Supplies expense ($38,000
)
<u>- Miscellaneous expense ($37,000)
</u>
EBIT $145,000
<u>- Taxes ($30,000)</u>
Net profit $115,000
Answer:
Mrs.Smith should continue to operate the business in the short run but shut down in the long run.
Explanation:
According to the shut down rule, at the profit-maximizing positive level of output, a business in a competitive market should continue to operate in the short-term if the price equals to or is greater than the average variable cost, but should shut down in the long term if the price is less than or equal to total cost. Here,
price = $8.10
avg variable cost = $8.00
avg total cost = $8.25
Mrs.Smith should continue to operate the business in the short run but shut down in the long run.
Answer:
B. Depletion will be $950,000 during 2018
Explanation:
Cost $10,000,000
Residual Value ($500,000)
Cost to be depleted $9,500,000
No. of Carats to be extracted over the life of mine 500,000
Per carat depletion (9,500,000/500,000) $19
Depletion for the year 2018 $19*50,000=$950,000
This will be deducted from revenue as depletion for the year.So option B is correct.
