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3 years ago

The Bureau of Labor Statistics has found that the base-year expenditures of the typical consumer break down as follows:

Business

1 answer:

Shkiper50 [21]3 years ago

8 0

Answer:

The CPI for the current year is 104.49

Explanation:

A) Expenditure breakdown of the base year:

You must check that they add 100%

Food and beverages: 17.8%

Housing: 42.8%

Apparel and upkeep: 6.3%

Transportation: 17.2%

Medical care: 5.7%

Entertainment: 4.4%

Other goods, and services: 5.8%

Total 100.0%

Total: 17.8 + 42.8 + 6.3 + 17.2 + 5.7 + 4.4 + 5.8 = 100

Thus, the CPI of the base year is 100.

B. Expenditure breakdown of the current year.

Calculate the changes by adding the percent of increase to each item tha has changed.

1. The prices of food and beverages have increased by 10 percent:

17.8% × 1.10 = 19.58%

2. The price of housing has increased by 5 percent:

42.8% × 1.05 = 44.94%

3. The price of medical care has increased by 10 percent:

5.7% × 1.10 = 6.27%

The other prices are unchanged.

Then, the new breakdown is:

Food and beverages: 19.58%

Housing: 44.94%

Apparel and upkeep: 6.3%

Transportation: 17.2%

Medical care: 6.27%

Entertainment: 4.4%

Other goods, and services: 5.8%

Total 104.49%

Of course the new total is not 100%.

19.58 + 44.94 + 6.3 + 17.2 + 6.27 + 4.4 + 5.8 = 104.49

That means that the price of the total basket of products has increased from 100 to 104.49.

Thus, the CPI of the current year is 104.49 ← answer

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Liam is considering putting money in an investment plan that will pay him $52,000 in 12 years. If Liam’s opportunity cost rate i

Margarita [4]

Answer:

a) The Maximum Liam should be willing to pay is $23,089

Explanation:

The maximum amount Liam should be willing to pay for the investment is the present value of the future amount of 52,000 discounted at 7%.

The present value of a future sum is its worth in today's terms.This represents how much Liam should be offered now to make him indifferent about the choice of receiving $52,000 in the future.

For example, It is the amount that should be invested today at 7% to become $52,000 in 12 years time.

The present value (PV) of a future sum (FV) can be ascertained using the formula below:

PV = FV × (1+r)^(-n)

PV = 52,000× (1+0.07)^(-12)

= 52,000×0.4440

= 23,088.62

= $23,089

The Maximum Liam should be willing to pay is $23,089

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3 years ago

John Jansen, an employee of Redwood Company, had gross earnings for the month of May of $4,000, FICA taxes are 8% of gross earni

pogonyaev

Answer:

The correct answer is B) 2,880

Step I - Ascertain All Pre Tax Deductions

Deduction 1 - Voluntary Deduction

This is given as $5. This is the only pretax deduction given.

To obtain John Jansens net pay, first we need to establish all the other deductions.

Deduction 2 - FICA Taxes.

FICA means “Federal Insurance Contributions Act.” FICA tax is mandatorily deducted from workers' paychecks to pay for the Social Security retirements and Medicare (Hospital Insurance) benefits for elderly Americans.

FICA Tax = 8% of Gros Earnings

Therefore FICA Tax = $\frac{8 X 3995}{100}$

FICA Tax = $319.60

Deduction 3 - Federal Income Tax

This has already been given as $ 675

Deduction 4 - State Income Tax

This is given as 3% of gross earnings.

That is 3995 x (3/100) or

= $\frac{3 X 3995}{100}$

= $119.85

Step 2 - To calculate the net pay, we need to seperate pre-tax deductions from after tax deductions.

The only pre tax item we have on the list is deduction 1 which is Voluntary deduction of $5.

Therefore Net Pay for John Jansen is ((Gross Pay Less Pretax Deductions) - Sum of other Taxes)

= [($4000 - $5) - ($319.60+$675+$119.85)

=$3,995 - $1,114.45

= $2,880.55 or $2 880 approximately.

Cheers!

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3 years ago

Each scenario below gives some information about price elasticity of demand for a firm. Use this information to answer the quest

Masja [62]

Answer:

increased

fell

14.57%

decrease

Explanation:

Price elasticity of demand measures the responsiveness of quantity demanded to changes in price of the good.

Price elasticity of demand = percentage change in quantity demanded / percentage change in price

If the absolute value of price elasticity is greater than one, it means demand is elastic. Elastic demand means that quantity demanded is sensitive to price changes.

Honest Abe's Used Cars has an elastic demand because its coefficient of elasticity is greater than one. Because demand is elastic, a rise in price would lead to a decrease in the number of cars sold. If price is increased, demand would fall more than the change in price, so total revenue would fall.

4.6 = 0.67 / percentage change in price

Percentage change in price = 0.67 / 4.6 = 0.1457 = 14.57%

Demand is inelastic if a small change in price has little or no effect on quantity demanded. The absolute value of elasticity would be less than one

Webs-R-Us services has an inelastic demand.

If prices are increased, demand would fall but it would fall less than the increase in price

Demand is unit elastic if a small change in price has an equal and proportionate effect on quantity demanded

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3 years ago

Classify each of the following as:___________

FrozenT [24]

Answer:

1. Ordinary maintenance and repairs.

a) Adding refrigerant to an air conditioning system.

b) Fixing damage due to a car accident.

e) Exterior and interior painting.

2. Assets improvements

c) Installing a new air conditioning system in an old building.

d) Paving a new parking lot.

h) New landscaping.

3. Extra ordinary repairs.

f) Overhauling an engine in a large truck.

g) Resurfacing a pool in an apartment building.

Explanation:

Assets improvements: this are improvements carried out on an assets for comfort and ease of use of such assets. Example is the installation of air conditioning unit in an old building.

Ordinary maintenance and repairs: this are maintenance and repairs carried out on machines, equipment and tools to bring them to the required working conditions or standard.

Extraordinary repairs: unlike ordinary maintenance and repairs this requires overhauling or changing of heavy components parts of a machine or equipment.

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3 years ago

Each member country to the TRIPS agreement must include in its domestic laws broad intellectual property rights and effective re

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Each member country of the TRIPS agreement must include in its domestic laws broad intellectual property rights and effective remedies for violations, which is a True statement. This is further explained below.

<h3>What is TRIPS agreement?</h3>

Generally, The TRIPS Agreement is a basic standards agreement that gives Members the option to provide more comprehensive intellectual property protection if they so choose.

In conclusion, It is True that each nation that is a part of the TRIPS agreement has a legal obligation to provide protections for intellectual property and remedies for infringements within its own domestic legislation.