Answer:
The given statement is FALSE.
Explanation:
It will only be till sustainable growth rate that the firm will not require external financing. The debt /ratio demands resources to sustain the operation, which are not powered by the profit margin.
Answer: Option (d) is correct.
Explanation:
Given that,
Net Income = $252,327
Depreciation expense = $21,821
Accounts Receivable increased by = $14,346
Inventory increased by = $33,617
Prepaid Expenses decreased by = $3,079
Accounts Payable decreased by = $4,161
Loss on the sale of equipment = $5,398
Operating Income = Net Income + Depreciation expense - Accounts Receivable - Inventory + Prepaid Expenses - Accounts Payable + Loss on the sale of equipment
= $252,327 + $21,821 - $14,346 - $33,617 + $3,079 - $4,161 + $5,398
= $230,501
Answer:
If Jenny doesn’t earn any interest on her savings and wants to perfectly smooth consumption across her life, how much will she consume every year?
Jenny's total income during her life = income as tax analyst ($60,000 x 10) + income as PhD student ($12,000 x 5) + income as Art Director (35 x $95,000) = $3,985,000
she generated income during 50 years and expects to live 20 more, so in order to perfectly smooth consumption across her life, she must divide her total life income by 70 years = $3,985,000 / 70 years = $56,928.57 per year
What might prevent her from perfectly smoothing consumption?
First of all, besides inflation, you also earn interest on your savings. That is why 401k and other retirement accounts work so well (the magic of compound interest). Even if inflation and interests didn't exist, you cannot know exactly what you are going to earn in the future and for how many years. In this case, she earned $60,000 for 10 years, but then earned only $12,000 during 5 years. If she really wanted to smooth her consumption, she would have needed to get a loan because her savings during the first 10 years wouldn't be enough.
Explanation:
The free enterprise system is one influenced by the market, which will determine all economic variables, such as price, products and services, and is a system independent of government control to function.
Therefore, it is correct to state that in a free enterprise system, the offer and demand of the consumer for a product or service that will be the determinant of the success or failure of an organization.
As an example of an entrepreneur, we can mention Steve Jobs, who created one of the largest technology companies in the world, Apple. The free enterprise system was one of the reasons for Apple to succeed in becoming one of the most valued companies in the world, due to the fact that it brought innovative products to the market that became examples of products of value to consumers, which made company to grow and become so successful in the market. If the company operated in a government-controlled market, it would probably have to follow specific rules and restrictions for the production of its products that could limit the company, and its performance could be restricted and not as innovative as the company in the market, which is one of the reasons why it achieved success.
