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REY [17]
3 years ago
12

Allen and Lewis are friends who each recently purchased real estate. Allen purchased a patio home in a small town an hour from t

he city, while Lewis purchased a condo in a really hot area near the city center. Although they paid similar amounts for their properties, if in six months Lewis' condo is worth much more. Which economic characteristic does this demonstrate?
Business
1 answer:
bagirrra123 [75]3 years ago
3 0

Answer:

Area preference

Explanation:

Hi, the economic  characteristic that this case  demonstrates is area preference.

Area preference is a very important land characterist that includes many factors like:

History, convenience ( in this case the distance between the area purchased and the city ), and reputation. These factors will affect the price of the land.

Feel free to ask for more if needed or if you did not understand something.

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Calculate the yield to maturity (YTM) for a one-year bond with a purchase price of $8,000, a face value of $10,000, and a curren
Mazyrski [523]

Answer:

yield to maturity YTM = 35%

Explanation:

given data

purchase price = $8,000

face value = $10,000

current yield = 10%

solution

we get here yield to maturity YTM

so first we get Annual Coupon by current yield that is express as

Current yield = annual coupon  ÷ current price   ..............1

put here value we get

Annual Coupon = 10 % ×  8,000

Annual Coupon = $800

now we get YTM by purchase price  that is  

purchase price = Annual Coupon ÷ ( 1+YTM ) + face value ÷ ( 1+YTM )  .......2

put here value we get

8,000 =  \frac{800}{1+YTM} +\frac{10000}{1+YTM}

solve it we get

yield to maturity YTM = 35%

5 0
3 years ago
If the equilibrium price of avocados is $4 and the government issues a price ceiling of $4.50, what is likely to happen in the m
Marat540 [252]

Answer:

A surplus of avocados will result from the price ceiling.

Explanation:

A price ceiling is when the government or an agency of the government sets the maximum price for a good or service.

A price ceiling is binding when it is set below equilibrium price.

The price ceiling ($4.50) is less than the equilibrium price ($4) of avocados. As a result, surplus would increase. The supply of avocados would exceed the demand because price ceiling is above equilibrium price

6 0
3 years ago
The stockholders' equity of Verrecchia Company at December 31, 2013, follows:
liq [111]

Answer:

Verrecchia Company

Financial Statement effects:

1. Jan. 5 Issued 10,000 shares of common stock for $12 cash per share:

Assets (Cash) would increase by $120,000

Equity (Common Stock) would increase by $120,000

2. Jan. 18 Repurchased 4,000 shares of common stock at $15 cash per share.

Assets (Cash) would decrease by $60,000

Equity (Common Stock) would decrease by $60,000

3. Mar. 12 Sold one-fourth of the treasury shares acquired January 18 for $18 cash per share.

Assets (Cash) would increase by $18,000

Equity (Common Stock) would increase by $18,000

4. July 17 Sold 500 shares of the remaining treasury stock for $13 cash per share.

Assets (Cash) would increase by $6,500

Equity (Common Stock) would increase by $6,500

5. Oct. 1 Issued 5,000 shares of 8%, $25 par value preferred stock for $35 cash per share.

Assets (Cash) would increase by $175,000

Equity (Preferred Stock) would increase by $125,000

Equity (Additional Paid-in Capital - Preferred) would increase by $50,000

Explanation:

The Financial Statement effects of each transaction is a reflection of how each transaction affects at least two opposite elements of the financial statement.  Every transaction affects the elements of the financial statement in one way or another, which enables the accounting equation to remain in balance.

For example, a transaction may increase the assets and also increase either the liabilities or equity side of the balance sheet.

In our example, the transactions affected only the balance sheet.  This means that each transaction increases or decreases the assets, liabilities, or equity sections.

5 0
3 years ago
Equestrain Roads accepted a customer's $50,000 zero-interest-bearing six-month note payable in a sales transaction. The product
babunello [35]

Answer:

$4,000

Explanation:

The difference between the face value of note and the issuance value of the note is discount. This discount is recorded and amortized over the note life to maturity. As the note is for 6 months and There are also six months from June 30, to December 31. So, all the Discount of $4,000 ($50,000-$46,000)  will be recognized as Interest Income. This discount can be amortized and recognized as Interest Income on monthly basis or collectively at the year end.

3 0
3 years ago
Give an example of one good or service produced in the United States using the command model. Justify your example using content
Ymorist [56]

What poster are you referring to? There’s nothing there but the question

5 0
3 years ago
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