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svlad2 [7]
3 years ago
6

Which of the following is true about how the "invisible hand" influences economic activity through prices when a product has low

er demand than supply?​
a. ​The price must increase, causing less buyers to buy and less sellers to sell.
b. ​The price must increase, causing less buyers to buy and more sellers to sell.
c. ​The price must decrease, causing more buyers to buy and less sellers to sell.
Business
1 answer:
Virty [35]3 years ago
8 0

Answer:

The correct answer is c.

Explanation:

Since the point the text is mentioning is above the equilibrium point, we know that the Demand is lower than it should be, while supply is bigger.

In order to increase the demand and lower the supply, we need to decrease the price to the equilibrium price. This will increase the demand and lower the supply making them intersect and reach the equilibrium point, a point that the invisible hand is influencing.

I hope this helps!

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Which of the following activities are credits? The impact on accounts receivable from a $10 million collection from a customer.
bagirrra123 [75]

i don’t know .........

3 0
3 years ago
Great Subs Inc., a regional sandwich chain, is considering purchasing a smaller chain, Eastern Pizza, which is currently finance
tatuchka [14]

Answer:

WACC 13.85600%

Explanation:

First we calculate Eastern Pizza CAPM:

Ke= r_f + \beta (r_m-r_f)

risk free = 0.08

market rate = 0.12

premium market = (market rate - risk free) 0.04

beta(non diversifiable risk) = 2

Ke= 0.08 + 2 (0.04)

Ke 0.16000

Then we solve for WACC

WACC = K_e(\frac{E}{E+D}) + K_d(1-t)(\frac{D}{E+D})

Ke 0.16000

Equity weight 0.8

Kd 0.08

Debt Weight 0.2

t 0.34

WACC = 0.16(0.8) + 0.08(1-0.34)(0.2)

WACC 13.85600%

The company will use the data on eastern Pizza to evualuate project presented to it. Also, it will  consider the new tax rate to determinate the tax shield.

3 0
3 years ago
Funds acquired by the firm through retaining earnings have no cost because there are no dividend or interest payments associated
kow [346]

Answer:

False

Explanation:

Retained earnings have no flotation costs, but have opportunity costs. For example, if companies distribute the earnings to shareholders, shareholders can invest the funds in alternative sources for returns.

8 0
3 years ago
Read 2 more answers
A construction company plans to build a certain number of apartment buildings and stores on a piece of land. This PPC shows the
Bond [772]

Answer 1) Option B) Shift to the right.

Explanation : If the amount of land available to the company increases, the PPC will shift to the right. As the graph indicates, the PPC will grow by shifting on right side as the company is acquiring more land for building purpose.

Answer 2) Option C) Remain Unchanged.

Explanation : The company realizes it cannot construct any buildings on a portion of the land because it is at risk of a cave-in.

In this case, the PPC will remain unchanged. When the company realizes that no construction can be done on the portion of land because of its hollowness the PPC will remain to be undisturbed.

5 0
3 years ago
Read 2 more answers
Mega-Big Corp. has a small strategic business unit (SBU) that produces a component vital to the manufacturers of automobiles and
galina1969 [7]

Answer:

Cash cow

Explanation:

Boston consulting group (BCG) Matrix: It is a framework created for the strategic position of the business and its potential. It classifies business units into four categories of a cash cow, Stars, question mark and Dogs on the matrix of the growth rate of industry and relative market share. This matrix is also known as the growth-share matrix.  

In the BCG matrix, If business unit lies in the category of a Cash cow, then it is considered as market leader as it generates more income and company are able to get a good return out of investment in this business unit. In the matrix, the Business unit have high market share, however, it has less growth prospect.  

In the given case, Mega-Big Corp has been manufacturing components of automobiles and has been extremely profitable for 18 years, therefore, Mega-Big Corp. is most likely considered a cash cow.

6 0
3 years ago
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