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babunello [35]
3 years ago
13

According to behavioral​ economics, consumers A. always behave rationally because they take into account monetary costs and nonm

onetary opportunity costs. B. do not always behave rationally because they take into account nonmonetary opportunity costs. C. do not always behave rationally because they accurately project their future behavior. D. do not always behave rationally because they ignore sunk costs. E. do not always behave rationally because they are overly optimistic about their future behavior.
Business
2 answers:
FromTheMoon [43]3 years ago
7 0

Answer:

E. do not always behave rationally because they are overly optimistic about their future behavior.

Explanation:

Behavioral economics is the study of irrational economic decisions from people's behavior.

Behavioral economics includes the people's emotional framework to make choices beyond the rational choice theory, which states that a rational person is not moved by emotions and social factors to choose the option that maximizes their satisfaction.

To be overly optimistic about your future behavior is biased from social factors and it is a behavior that could be understood from the human emotional framework.

Makovka662 [10]3 years ago
3 0

Answer:

The correct answer is letter "E": do not always behave rationally because they are overly optimistic about their future behavior.

Explanation:

Behavioral economists study the reactions of customers and the tendencies they take while purchasing. In most cases, consumers are <em>confident </em>about a purchase but do not take into consideration if the purchase will help them have a better future condition. They tend to believe it will be the same prioritizing the need the item purchase will momentary satisfy. In that case, economist say customers <em>do not act rationally</em>.

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The TrunkLine Company will earn $60 in one year if it does well. The debtholders are promised payments of $35 in one year if the
Yuliya22 [10]

Answer:

The answer is a. $25.00

Explanation:

The bondholder's cash flow in one-year time from holding a TrunkLine's bond is calculated as:

(The possibility of TrunkLine doing well x Repayment receipt in case TrunkLine doing well) + (The possibility of TrunkLine doing poorly x Repayment receipt in case TrunkLine doing poorly) = (0.5 x 35) + (0.5 x 20) = $27.50.

The current price bondholders are willing to pay for a bond is equal to the present value of a bond's cash flow in one-year time, discounted at the interest rate on the bond 10% which is calculated as below:

27.50 / (1+10%)^1 = $25

Thus, the correct choice is a. $25.00

6 0
3 years ago
A credit balance in which of the following accounts would likely indicate an error? a.Accounts Payable b.Fees Earned c.Janet Jam
maxonik [38]

Answer:

d. Salary Expense

Explanation:

Salary Expense refers to the salaries or fixed payment by an organization to it's employees. It is an expense and as per the rules of accounting, "debit all expenses and losses, credit all incomes and gains."

Salary expense represents salary which has been earned whether paid or not, as per the accrual concept of accounting.

Thus, a credit balance in Salary Expense represents a likely error since such an account is usually associated with a debit balance, being an expense.

7 0
3 years ago
Grand River Corporation reported taxable income of $600,000 in year 1 and paid federal income taxes of $155,000. Not included in
Paul [167]

Answer:

$444,000

Explanation:

current earnings and profits = (taxable income - income taxes) - meals expense + tax exempt income = ($600,000 - $155,000) - $3,000 + $2,000 = $444,000

Disallowed expenses are expenses made by an individual or company that the IRS doesn't allow to be deducted, e.g. meals. Tax exempt income is income that is not taxed by the IRS, e.g. DRD includes at least 70% of dividends received.

Deferred gains or unearned revenues are considered a liability and are not included in the income statement.

7 0
3 years ago
Managerial accounting is an activity that helps managers determine costs of products and services, plan future activities, and c
Elenna [48]

Answer:

True.

Explanation:

Managerial accounting involves managers using accounting information to better inform themselves before making business decisions. It involves analysing, interpreting and communicating financial data to managers to aid in achievement of organisation's goals.

Managerial accounting is for internal use in the business. Data is modified to meet specific need of the end-user. For example a manager may want to see sales figures for a quarter compared to business target. This will give an idea if the business is meeting it's objectives.

4 0
4 years ago
The breakeven point decreases if? ________.
MAXImum [283]
Beak-even point (BEP) in business is the point at which total cost and total revenue are equal. There is no net gain or loss, and one has "broken even", though opportunity costs have been paid and capital has received the risk-adjusted, expected return.
The formula for break-even is given by:
BEP=(Fixed Costs)/(Sales Price per Unit-Variable Cost per Unit)

From the above formula we can conclude that:
When Fixed costs reduces, the BEP decreases. Therefore the answer is [a]
3 0
4 years ago
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