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Neporo4naja [7]
3 years ago
13

Governor Smith of Georgia is presented with the following data: currently the state derives a total of $400 million of benefits

from education spending and it only costs $250 million. The legislature proposes increasing spending to $300 million. Quality studies show that this new spending will increase the total benefit of education to $425 million. Choose the correct relevant answer below.
A)
Since the new total benefit of $425 million is so much larger than the new total cost of $350 million, it clearly makes economic sense to spend the extra money according to the Cost-Benefit Principle.

B)
To get the economically wise decision made according to the Cost-Benefit Principle, we need to compare the marginal benefit of $25 million with the total cost of $350 million. This new spending makes no economic sense.

C)
In order to use the Cost-Benefit Principle correctly we need to compare the marginal benefit of the new spending, which is $25 million, with the marginal cost of the new spending, which is $50 million. This new spending makes no economic sense.

D)
Education spending by the state clearly makes no sense under any circumstances according to the Cost-Benefit Principle. As we can see from the data above, there is no amount of spending where the total benefits exceed the total costs.
Business
1 answer:
Rudiy273 years ago
8 0

Answer:

C)

In order to use the Cost-Benefit Principle correctly we need to compare the marginal benefit of the new spending, which is $25 million, with the marginal cost of the new spending, which is $50 million. This new spending makes no economic sense.

Explanation:

The cost-benefit principle in accounting states that the additional benefit must outweigh additional cost in an accounting system.

Spending of $250 million is giving $400 million revenue. The new proposal of spending $300 million to get $425 million implies we are spending extra $50 million to make extra $25 million.

This is not a good investment according to the cost-benefit principle.

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Answer:

not until the early 19th century were a few countries able to establish sustained long-run economic growth.

Explanation:

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However, in the advent of industrialization and technological advancement, machines were invented to replace human and animal power.

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In human history, we know that not until the early 19th century were a few countries able to establish sustained long-run economic growth.

3 0
2 years ago
A project has cash flows of -$152,000, $60,800, $62,300, and $65,000 for years 0 to 3, respectively. The required rate of return
Blababa [14]

Answer:

c. 11.32; reject

Explanation:

The IRR is the rate at with net present value equals zero.

-152,000 + \frac{60,800}{1+IRR} +\frac{62,300}{(1+IRR)^{2} } +\frac{65,000}{(1+ IRR)^{3} } = 0

\left[\begin{array}{cc}Period&Cash Flow\\0&-152,000\\1&+60,800\\2&+62,300\\3&+65,000\\4&0.113237029\\\end{array}\right]

To solve it you use excel or a financial calculator:

0.1132370

Because the IRR is lower than minimun aceptable rate of return, the project should be rejected.

7 0
3 years ago
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a_sh-v [17]

Answer:

The answer is $75

Explanation:

The formula to reach out value addition is

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So by entering above numbers in Value Addition formula we get

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