In perfect competition, firms will be able to earn economic profits in the short run.
<h3>What is perfect competition?</h3>
A perfect competition is characterized by many buyers and sellers of homogenous goods and services.
In the long run, firms earn zero economic profit. If in the short run firms are earning economic profit, in the long run firms would enter into the industry. This would drive economic profit to zero.
To learn more about perfect competition, please check: brainly.com/question/17110476s
Answer:
B) 9.1%
Explanation:
Cost of debt is the interest rate paid by a company due to borrowing money; i.e debt from investors.
$185million in debt is the face value of debt that Westford Corporation had and the $26 million dollars of interest expense is the cost of the debt in dollars;
First, find pretax cost of debt ;
Pretax cost of debt = (Interest expense / Face value of debt )*100
= (26,000,000/ 185,000,000 )*100
=0.1405 *100
= 14.05%
Next, use pretax cost of debt to find after-tax cost of debt;
After-tax cost of debt = Pretax cost of debt (1-tax)
= 14.05% *(1-0.35)
= 9.13%
Therefore, Westford's cost of debt capital is 9.1%
Answer:
I will take $36,230.5 to pay for the education of child.
Explanation:
Cash Invested in the saving account will earn a return of 8% each year and this amount could be withdrawn by the me to pay for the education of child.
We will use following formula to calculate the annual payments
P = r ( PV ) / [ 1 - ( 1+ r )^-n ]
where
PV = amount of investment = $120,000
r = rate of return = 8%
n = number of period = 4 years
P = 8% ( 120,000 ) / [ 1 - ( 1 + 0.08 )^-4 ]
P = 36,230.5
In economics, if a good is inelastic, then <u>its supply or demand is not sensitive to price changes.
</u>
Changes or fluctuations in market prices does not affect the supply and the Demand of inelastic goods.
<h2>Further Explanation;
</h2>
- Inelastic goods, are types of goods whose demand and supply is not affected by changes in market prices. That is an increase or decrease in market price does not affect their supply or demand.
- When the price of an inelastic good changes, its supply and demand is unaffected.
- Examples of such goods include, water and food. Therefore, for inelastic goods, the consumer buying strength and habits remain the same.
<h3>Demand and supply in determination of market price
</h3>
- Demand refers to the quantity of goods or services that consumers are willing and able to buy at a particular price while supply is the quantity of goods or services that suppliers are willing to supply to the market at a particular price.
- One of the factor that determine market prices are the forces of demand and supply, this is based on the ability and willingness of buyers and sellers to undertake selling and buying.
- Buying and selling occurs at an equilibrium price that is agreed upon by sellers and buyers.
- This means the sellers and buyers are willing to exchange a certain quantity of a commodity at this price. Thus, price depends on the demand and supply in the market.
- However, for <u>inelastic goods</u> such as water and food, the consumer has no option than to buy them at existing prices since they are necessity goods.
Keywords; Inelastic goods, demand and supply, market price.
<h2>Learn more about:
</h2>
- Demand and supply; brainly.com/question/6749722
- Effect of supply and demand on market price: brainly.com/question/3522474
Level; High school
Subject: Business
Topic: Demand and supply
Sub-topic: Types of goods
Answer:
Dividend yield is 2.91 %.
Explanation:
Dividend yield = Annual Dividend per Share / Stock Price per Share × 100
<em>where,</em>
Annual Dividend per Share = Total Dividends ÷ Total Number of Shares
= $835 ÷ 500
= $1.67
<em>then,</em>
Dividend yield = $1.67 / $57.48 × 100
= 2.905 or 2.91 %
