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Andrei [34K]
3 years ago
8

Tom knows that the title insurance company made a mistake on his property title. Because of their mistake, his neighbor now has

access to an easement road through the 25 acres located at the back of his property. He can't use the acreage for pasture, because his neighbor insists that the gates remain open. The title company has offered a $40,000 settlement. Tom has decided to take the settlement rather than possibly lose in court if he were to sue the title company for more money. Tom's decision is based on ________.a. hindsight bias.
b. escalation of commitment.
c. availability bias.
d. risk aversion.
e. randomness error.
Business
1 answer:
gayaneshka [121]3 years ago
7 0

Answer:

The correct answer is d. risk aversion.

Explanation:

Risk aversion is an investor's preference for avoiding uncertainty in their financial investments.

Due to this attitude towards risk, this type of individuals directs their investment portfolio to safer financial assets even though they are less profitable.

The phenomenon of risk aversion implies by definition a certain level of risk rejection by a person who invests in financial markets. A person may face a risk aversion situation, be risk neutral or be risk prone.

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The following transactions occur for Badger Biking Company during the month of June: Provide services to customers on account fo
Taya2010 [7]

Answer:

a) Assets increase by 35,000 (account receivable )

   Equity increase by 35,000 (sales revenue)

b) no effect

c) Assets increase by 20,000 (equipment)

Liabilities increase by 20,000 (note payable)

d) Assets decrease by 3500 (cash)

   Equity decrease by 3500 (utilities expense)

Explanation:

Accounting Equation:

Assets = Liaiblities + Equity

Assets: things and right owned by the company and able to generate cash in the future

Liabilities: obligation to do or pay assumed by the company

Equity: contribution from owners and earnings/losses

a) Provide services to customers on account for $35,000.

As the company has the right to claim the invoince aginst his customers and is also earning a profit from this sale

b) Receive cash of $27,000 from customers in (a) above.

we are "trading" one assets (account receivable) for another (cash) As the amount collected decerase the amount owed by the customer the effect of income from cash and decrease in amount to collect balance.

c) Purchase bike equipment by signing a note with the bank for $20,000.

the new equipment is an asset, it wil lgenerate earnings in the future. While the promissory note is an obligation thus, liability.

d) Pay utilities of $3,500 for the current mont.

the utulities paid will not generate incoem in the future are cost incurred thus, expenses which decreases the earnings of the business.

6 0
3 years ago
An individual who has NO prior experience in starting up a business, inheriting a business or purchasing a business.
NemiM [27]

Answer:

i do

Explanation:

is this a question?

4 0
3 years ago
What is the best thing to say when somebody knocks on the bathroom door
Semenov [28]

Answer:

D

Explanation:

6 0
2 years ago
U.S. appliance manufacturers find that different customs about shopping must be used to determine product design. For instance,
kvv77 [185]

Answer:

U.S. appliance manufacturers would be more likely successful if they used a <u>Transnational</u> marketing strategy

Explanation:

Transnational marketing strategy is a more personalized approach to selling and marketing with target customers need, shopping preferences and specifications put into consideration in the designing of the goods and services.

This strategy applies to the U.S. appliance manufacturers selling to different countries.

Therefore, people in Northern Europe who shop only once a week will be presented with bigger refrigerators while Southern Europeans who shop daily can opt for smaller ones.

7 0
3 years ago
A small craft store located in a kiosk expects to generate annual cash flows of $6,800 for the next three years. At the end of t
Dafna11 [192]

Answer:

The monetary value is $24,201.23

Explanation:

Giving the following information:

Cash flows:

Year 1= $6,800

Year 2= 6,800

Year 3= 6,800

Year 4= $15,000.

The discount rate is 15 percent.

We need to discount each cash flow to the present value:

PV= FV/(1+i)^n

Year 1= 6,800/1.15= 5,913.04

Year 2= 6,800/1.15^2= 5,141.78

Year 3= 6,800/1.15^3= 4,471.11

Year 4= 15,000/ 1.15^4= 8,576.30

Total= $24,201.23

6 0
3 years ago
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