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3 years ago

An increase in input prices causes:___________

Business

1 answer:

Svetach [21]3 years ago

5 0

Answer: the market supply to shift inward, driving the equilibrium price higher.

Explanation:

An increase in input prices will result into a rise in the production costs. This will result in a leftward shift of the supply curve.

Therefore, the market supply will shift inward, driving the equilibrium price higher. This simply means that there will be lesser supply of the product and hence, increase in price.

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Laurel, Inc., and Hardy Corp. both have 6 percent coupon bonds outstanding, with semiannual interest payments, and both are curr

stealth61 [152]

Answer:

A. If interest rates suddenly rise by 2 percent, what is the percentage change in the price of these bonds?

Laurel, Inc. = -8.11%

Hardy Corp. = -18.91%

B. If interest rates were to suddenly fall by 2 percent instead, what would the percentage change in the price of these bonds be then?

Laurel, Inc. = +8.98%

Hardy Corp. = +25.49%

Explanation:

bonds with 6% semiannual coupons, sold at par $1,000

Laurel, Inc. bond maturity in 5 years

Hardy Corp. bond maturity in 18 years

the current price of a bond is the sum of the present value of its face value and coupons. I will use an annuity table to calculate PV of face value and an ordinary annuity table for the coupons:

Laurel, Inc.

market rate 4% = ($1,000 x 0.8203) + ($30 x 8.9826) = $820.30 + $269.48 = $1,089.78, % change = 89.78/1,000 = 8.98%

market rate 8% = ($1,000 x 0.6756) + ($30 x 8.1109) = $675.60 + $243.33 = $918.93, % change = -81.07/1,000 = -8.11%

Hardy Corp.

market rate 4% = ($1,000 x 0.4902) + ($30 x 25.489) = $490.20 + $764.67 = $1,254.87, % change = 254.87/1,000 = 25.49%

market rate 8% = ($1,000 x 0.2437) + ($30 x 18.908) = $243.70 + $567.24 = $810.94, % change = -189.06/1,000 = -18.91%

3 0

3 years ago

What is accounting? and what is accounting all about?

Doss [256]

Accounting or accountancy is the measurement, processing, and communication of financial and non financial information about economic entities such as businesses and corporations.

4 0

2 years ago

Read 2 more answers

As Prepaid Rent is used, the asset becomes a/an

melamori03 [73]

As prepaid rent is used, the asset becomes a liability.
Liability because it becomes the responsibility of someone who uses the prepaid. Since the prepaid rent was used, it needs money to be able to pay them. It becomes the responsibility for someone to be able to use his money to pay the prepaid rent that was used.

6 0

3 years ago

Read 2 more answers

The cash account for Coastal Bike Co. at October 1, 20Y9, indicated a balance of $5,140. During October, the total cash deposite

Ne4ueva [31]

Answer:

Explanation:

Bike Co.

Bank Reconciliation

Cash balance according to Bank statement 8,980

Add:Deposits of May 31,not recorded by bank 1,050

Add:Bank error in charging checks as 730instead of $370 360 1,410

10,390

Deduct:checks outstanding 5,560

Adjusted balance 4,830

Cash balance according to company records 3795 (5140+39175-40520)

Add:collection of note 2,120

5915

Deduct: Error in recording cheque (310-130) 180

Bank service charge 25

NSF 880 1,085

Adjusted balance 4,830

2) Journal entries'

a 31-May Cash 2,120

Note receivable 2,000

interest revenue 120

b. 31-May Accounts payable-rack pro co 180

Miscellaneous expense 25

account receivable 880

cash 1,085

3) 4,830

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3 years ago

Tom's Shoes makes a profit from selling its shoes, provides free shoes to children in countries in need, encourages volunteers t

Tcecarenko [31]

Answer: Value of its stakeholders

Explanation: Tom's shoes is doing the charity work and also earning good profits from selling its product. Stakeholders refers to all those parties who will get affected due to operations of the business.

One of the stakeholders for every business entity is the society in which it resides in. Tom's shoes is creating value to one of its stakeholders by free distribution of its product to those in need .

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3 years ago