Answer:
Total number of years = 35
a. Expected cost in 2017 = $25 * e^(35*0.16)
Expected cost in 2017 = $25 * e^5.6
Expected cost in 2017 = $25 * 270.42
Expected cost in 2017 = $6,760.50
b. If the average cost of a textbook in 2012 was $150, then the actual inflation rate:
150 = 25 * e^(r*t)
150 = 25 * e^(r*30)
6 = e^(r*30)
Taking log base e on both side
30r = Ln6
30r = 1.7918
r = 1.7918/30
r = 0.05972667
r = 5.97%
So, actual inflation rate is 5.97%
Answer:
b. increase; decrease
Explanation:
As the input prices increase, the firms average cost will increase as well, this will make the equilibrium point move as the supply curve will shift to the left.
This movement will met the demand curve at a higher price and therefore, a lower quantity as the consumer demands decreases when the price of a certain good increase and move a portion of his consumption to other goods whch now has a lower opportunity cost.
Surplus. Is this a multiple choice?
Answer:
The Tax savings for the property tax is 3200 USD.
Explanation:
As Katie paid property taxes as $10000 in tax-deductible property taxes. In calculation of this the marginal tax rate is used in calculation. Thus
So the Tax savings for the property tax is 3200 USD.
Answer:
Pirate Recording Company Inc.
The firm's stock would most likely be classified as a(n):
growth stock.
Explanation:
Since Pirate Recording Company's stock is expected to grow rapidly more than the market average, it is regarded as a growth stock. Stockholders expect to make more capital gains by selling the stocks in the future than from collecting dividends. As Pirate Recording is in an expansion mood, with new capital injections of $150 million, it will be retaining its earnings to pursue its growth potential, thus, further exciting potential stockholders.