Power Pro, a leading manufacturer of lawn and garden equipment, releases a new line of cordless, lightweight, electric weed trim
1 answer:
You might be interested in
Answer: a. More of Project A's cash flows occur in the later years.
Explanation:
When a project has its cashflows occurring in later years, the NPV will be less because the discount rate would have a greater period to discount it in as opposed to cashflows that occur more recently which would receive less discounting from the discount rate.
As a result of Project A having more distant cashflows, the discount rate discounted its cash flows more which is why higher rates led to its NPV being zero because those higher rates got to discount it over a longer period.
Answer:
please check the attached image for the completed table containing the answers
The industry is purely competitive.
Explanation:
please check the attached image for a clear image of the table used in answering this question
Total revenue = product price x quantity demanded
for example, total revenue when quantity demanded is 2 is $ x 2 = $4
Marginal revenue is change in total revenue.
marginal revenue = total revenue - previous total revenue
e.g. marginal revenue when quantity demanded is 2 is = $4 - $2 = $2
the structure of the industry is a purely competitive market because price is equal to marginal revenue.
A perfect competition is characterised by many buyers and sellers of homogeneous goods and services. Market prices are set by the forces of demand and supply. There are no barriers to entry or exit of firms into the industry.
In the long run, firms earn zero economic profit. If in the short run firms are earning economic profit, in the long run firms would enter into the industry. This would drive economic profit to zero.
Also, if in the short run, firms are earning economic loss, in the long run, firms would exit the industry until economic profit falls to zero.
