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nalin [4]
3 years ago
13

One problem with the consumer price index stems from the fact that, over time, consumers tend to buy larger quantities of goods

that have become relatively less expensive and smaller quantities of goods that have become relatively more expensive. This problem is called ____.
Business
1 answer:
BigorU [14]3 years ago
4 0

Answer:

SUBSTITUTION BIAS

Explanation:

Substitution bias occurs when a customer decides to purchase a substitute of a good after the prices becomes cheaper than the goods they normally purchase. It rises as a problem in price index due to the fact that customers/buyers can decide to change or substitute goods at an instant because of changes in prices. In situations like this, customers tend to avoid the whole increase in prices by changing to cheaper substitutes. Substitution generally is a consumer changing or substituting an expensive product for a cheaper one due to changes in prices. This usually leads to inflation rate been overestimated or overstated.

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Assume that locating a cement factory in the middle of Boston would save the producer $5 million at a public expense, in polluti
never [62]

Answer:

$5 million

Explanation:

If we follow the Coase Theorem, the appropriate solution to this case should be obtained regardless of initial rights. In this case, the factory saves $5 million to the producer, but it costs $10 million to Boston residents. if Boston residents pay $5 million or more to the factory owner, then both would benefit. Boston residents will gain $10 - $5 = $5 million, as well as the factory owner.

7 0
3 years ago
a bond has a face value of $1,000, an annual coupon rate of 7 percent, yield to maturity of 10 percent, and 20 years to maturity
rewona [7]

The bond that has a face value of $1,000 has a duration of 10 years.

<h3>What is a bond?</h3>

A bond is a type of security in the financial world where the issuer (debtor) owes the holder (creditor) a debt and is required, depending on the terms, to repay the bond's principal (i.e., the amount borrowed) at the bond's maturity date as well as interest (referred to as the coupon) over a predetermined period of time. The interest is typically due at regular intervals, such as every six months, once a year, and less frequently at other times. To finance long-term investments or, in the case of government bonds, to finance immediate expenses, the borrower can obtain external funds through the sale of bonds. Both bonds and stocks are considered to be forms of security, but the main distinction between the two is that (capital) stockholders have an equity stake in a company, whereas bondholders have a creditor stake.

To learn more about bond, visit:

brainly.com/question/28362992

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5 0
1 year ago
Bí quyết nào để giữ chân khách hàng online? (Sau khi chốt đơn, sau khi mua hàng, sau khi sử dụng sản phẩm/dịch vụ)?
Aleonysh [2.5K]

Answer:

ठःअःठःठःठठृठःठः आणि सौ सोसायटी ह्या दोघांची नजरानजर झाली आणि ते दोघे हॉस्पिटलच्या उपहारगृहात दोघं राजा राणी ती होती आणि आपल वाईट मत बनवणं हा विचार आणि ते ही एकट्याने येत नाही आणि आपल वाईट मत बनवणं हे पुस्तक वाचून माझी उत्सुकता होती

3 0
3 years ago
You invested ​$29 comma 000 in two accounts paying 2 % and 5 % annual​ interest, respectively. If the total interest earned for
Korolek [52]

Answer:

Amount invested in account paying 2% = $17,000

Amount invested in account paying 5% =  $12,000

Explanation:

Total amount invested = $29,000

Total Interest earned = $940

Let the amount invested in account paying 2% interest be 'x'

Therefore,

the amount invested in account paying 5% interest will be '$29,000 - x'

Now,

( 2% of x ) + [ 5% of  ( $29,000 - x)] = $940

or

0.02x + 1450 - 0.05x = $940

or

- 0.03x = $940 - $1450

or

- 0.03x = - $510

or

x = $17,000

Hence,

Amount invested in account paying 2% = $17,000

Amount invested in account paying 5% = $29,000 - $17,000 = $12,000

5 0
3 years ago
Mission Company is thinking of discontinuing product line F because it is reporting an operating loss. All fixed costs are unavo
Ierofanga [76]

Answer:

Operating income will decrease.

Explanation:

The company's operating income is dependent on the production lines and in the short run the company might be cutting its expenses and losses by shutting down the production line but cutting a part of the company which can produce revenue is never a solution rather the company checks how they can cut down their expenses as they have unavoidable fixed expenses by this action it will seem that they will cut $21000 rental expense only and how much revenue will they will actually loose? a lot.

The company can even adjust on the space they rent or move t a cheaper cost and also work on the expenses that are unavoidable to decrease them and maximize on getting more revenue.

4 0
3 years ago
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