Answer:
c. cease production immediately, because it is incurring a loss.
Explanation:
When a business engages in production it looks to make profit. That is for the production price to be higher than cost incurred in producing the good.
However when the price is lower than the average variable cost as is indicated in the scenario then the firm needs to shut down production in the short term.
Factors that will adversely affect a firm in the short term are price, average total cost, and average variable cost.
Once price is less than average total cost or average variable cost it is better to stop production.
As they are incurring an economic loss
Answer:
A
Explanation:
IPO , a synonym for initial public offering is a process of offering to the public new stock issuance through an underwriter.
IPO comes with a lot of benefit , nevertheless financial economist have some concern about it .
Of all the options given in the question , the long run of a new public company , (three to five years from the date of issue) being superior to the overall market returns is the only exception
Answer:
a. not change; improve
Explanation:
Balance of trade is the difference in value over a period of time between a country’s imports and exports of goods and services, usually expressed in the unit of currency of a particular country (e.g., dollars for the United States, yen for the Japan).
Balance of payments record the receipts and payments of the residents of the country in their transactions with residents of other countries.
A Japanese insurance company purchases U.S. government securities. From the perspective of the United States, the balance of trade with Japan will not change and the balance of payments with Japan will improve.
Answer:
The correct answer is c) rises.
Explanation:
Each country in question will specialize in what is most efficient. At the same time, it will import the rest of the products in which they are most ineffective in terms of production. Although a country does not have an absolute advantage in producing any good, it may specialize in those goods in which it finds a greater comparative advantage and finally participate in the international market. In this sense, it can boost its foreign trade.
It is then the basic idea that countries choose to specialize in order to trade in activities where they have a certain advantage. That is, instead of producing what they do best in an absolute way, they produce what they do best in a relative way. Therefore, the difference with the theory of absolute advantage is that it does not produce what the country costs less, but the one with lower comparative costs.
