Answer:
true, it reduces costs by sharing activities
Explanation:
In this case, since the diversified firm has three different businesses that share common marketing and service operations, it is benefiting from a type of economies of scope called shared activities.
Economies of scope basically refers to saving money when producing two or more goods or services by using common production processes in order to reduce costs. The joint production of the goods or services will cost less than if the company produced each one separately.
This company is benefiting from using shared activities because one single marketing unit and another single operations unit will serve the three separate businesses.
Answer:
A) The firm can ratify Haskin's actions and take over the contract.
Explanation:
Hanskin's was not explicitely allowed to buy the property in Arizona, but he did it with the intention of increasing the amount of assets that the real estate company holds.
The board of directors should simply take over the contract as long as it is profitable (it most likely is), and analyze whether to change its policies about property purchasing or not, because requiring a board resolution for each one of them can make the process slow and increase opportunity costs.
Answer:
PV= $15,291.74
Explanation:
Giving the following information:
Annual cash flow= $1,5000
Number of years= 20
Interest rate= 7.5%
To calculate the present value, first, we need to determine the future value using the following formula:
FV= {A*[(1+i)^n-1]}/i
A= annual cash flow
FV= {1,500*[(1.075^20) - 1]} / 0.075
FV= $64,957.02
Now, we can calculate the present value:
PV= FV/(1+i)^n
PV= 64,957.02/(1.075^20)
PV= $15,291.74
Answer:
Groups hurt by inflation: Fixed Salary Earners and Pensioners, Creditors and Savers.
Explanation:
Inflation refers to a quantitative measure of a rate at which a basket of selected goods and services’ average price level in an economy up rises over some time period. Inflation is indicative of a rise in general price level wherein a single currency unit buys less than what it did formerly. Expressed in percentage, inflation is indicative of a decline in the national currency’s purchasing power.
<u>GROUPS HURT BY INFLATION
</u>
<u>Fixed Salary Earners</u>: Their real income is eroded by inflation.
<u>Creditors</u>: When loan is repaid, its purchasing power is reduced.
<u>Savers</u>: This group is most hurt since the official nominal interest of the bank cannot resist the real rate of interest (inflation rate).
