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Verizon [17]
3 years ago
9

Inflation is problematic if a. it is less than the percentage increase in nominal income. b. it is less than the nominal return

on saving. c. it equals the growth rate of real GDP in the long run. d. it distorts relative prices, causing a misallocation of resources.
Business
1 answer:
zmey [24]3 years ago
8 0

Answer:

It distorts relative prices, causing a misallocation of resources.

Explanation: Inflation is an economic term used to describe a situation in a country's market when there is a sudden rise in commodities sold in the market. Inflation can be as a result of an increase in demand of commodities sold in the market.

It has a negative effect, when the prices are distorted and the purchasing power is not properly allocated to the buyers.

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Steinberg Corporation and Dietrich Corporation are identical firms except that Dietrich is more levered. Both companies will rem
Lapatulllka [165]

Answer:

a. What is the value today of Steinberg's debt and equity?

  • $2,890,909

b. What is the value today of Dietrich's debt and equity?

  • $2,890,909

c. Steinberg’s CEO recently stated that Steinberg’s value should be higher than Dietrich’s because the company has less debt and therefore less bankruptcy risk. Do you agree or disagree with this statement?

  • A. Disagree: a company's value is determined by by its operating income (EBIT), not by there capital structure (M&M theory).

Explanation:

economic expansion 80% chance, EBIT $3.5 million

economic recession 20% chance, EBIT $1.9 million

expected EBIT = (3.5 x 0.8) + (1.9 x 0.2) = $2.8 million + $0.38 million = $3.18 million

Steinberg's debt obligations $980,000 at the end of next year

Dietrich's debt obligations $2,000,000 at the end of next year

total company value = $3.18 million / (1 + 10%) = $2,890,909

3 0
3 years ago
Assume a demand equation for good​ 'x': Q = 9 - 0.1p - p_y + 0.01p_z + 0.0005Y; where p = own price of the good Q = quantity dem
Ray Of Light [21]

Answer:

Q = 10 - 0.1p

Explanation:

Given that,

Demand equation for good​ 'x':

Q = 9 - 0.1p - p_y + 0.01p_z + 0.0005Y

Where,

p = own price of the good

Q = quantity demanded

p_y = price of a related good = $3

p_z = price of a different related good = $200

Y = consumer income = $4,000/month

Therefore, the quantity demanded as a function of the price can be written as follows;

Q = 9 - 0.1p - p_y + 0.01p_z + 0.0005Y

Q = 9 - 0.1p - 3 + 0.01(200) + 0.0005(4,000)

Q = 6 - 0.1p + 2 + 2

Q = 10 - 0.1p

5 0
4 years ago
You are working on a brochure about your business. The type for the body text will be black and that for the section headings wi
muminat

The correct designing principles that will be implemented to create the brochure will be Contrast and Repetition.

In the question, it is stated that a brochure has to be made for the business. The brochure will be designed such that the text will be in black color, the section headings will be blue, etc. In order to create such a brochure, the Designing principles will include Contrast and Repetition.

Contrasting and Repetition are based on making people visualize and highlight the key points of the brochure. It is basically based upon creating a contrasting difference between and highlighting the important key points in the brochure.

To know more about Advertising, Click here:

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7 0
1 year ago
Because of the __________, the united states does indeed have a(n) __________. income tax, progressive tax system income tax, re
Lynna [10]

income tax, progressive tax system income tax

5 0
3 years ago
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Remodeling is an<br> A. neither. B. Asset. C.expense
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C expense meaning cost money

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