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3 years ago

When a market experiences a positive externality,

Business

1 answer:

antoniya [11.8K]3 years ago

5 0

Answer:

b. The demand curve does not reflect the value to society of the good.

Explanation:

An externality is a financial term alluding to an expense or advantage caused or got by an outsider. Nonetheless, the outsider has no power over the making of that cost or advantage.

An externality can either be positive or negative which can be caused by either production or consumption of a good or service. The cost or the benefit can affect an individual or a society as a whole. A typical example of a negative externality is pollution which can cause negative cost to a third party in terms of health expenses. An example of a positive externality on the other hand is when a well educated labor force increase their productivity.

The government and local authorities can control negative externality by imposing taxes and regulation of these products. The government can also overcome negative externality by imposing subsidies on the goods that improve positive externality.

The demand curve however does not reflect the value to society of the good. It only reflects the relationship between the price and the quantity of goods consumed.

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Mona sets up a business consulting firm in which the employees are motivated because they find their work interesting and creati

gayaneshka [121]

Answer:

Letter C is correct. <em>A firm that relies on high output controls to tap into intrinsic motivation.</em>

Explanation:

By carefully selecting the employees of his consulting firm, Mona ensures that each employee's expected competency and skills profile has been met through rigorous selection, which enhances the chances that operational strategies will be more widely deployed and accepted effective.

By setting the expected results, but letting the employees themselves define how to achieve them, it generates an intrinsic motivation, one that generates internal feelings in the individual to want to achieve personal goals, objectives and projects that motivate and stimulate them.

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4 years ago

A flower shop uses ten-year-old software to make sales. It is often slow and ineffective. What type of influence is affecting th

kakasveta [241]

B.) Internal. The answer should be B

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3 years ago

Read 2 more answers

Pacific Packaging's ROE last year was only 6%; but its management has developed a new operating plan that calls for a debt-to-ca

Firdavs [7]

Answer:

13.75%

Explanation:

Calculation for what will be the company's return on equity

First step

Asset Turnover Ratio= Net Sales / Total Assets ------(1)

Given Asset Turnover Ratio =2.7

=> 2.7 = 4,000,000/ Total Assets (from equation 1)

=>Total Assets = 1,481,481 ------(2)

Second step

ROE = Net Income / Equity

Net Income = (EBIT - Interest Charges) *(1-tax rate)

Net Income = (356,000 -168,000) *(1-35%)

Net Income = $122,200 --------(3)

Equity = Total Assets *(1-debt ratio)

Equity = 1,481,481*(1-0.4) = $888,889 --------(4)

From equation 3 and 4

ROE = Net Income / Equity

ROE= 122,200/888,889

ROE =0.1375*100

ROE=13.75%

Therefore ROE will be 13.75%

5 0

3 years ago

What is the difference between wacc and marginal cost of capital?

kvv77 [185]

<span>Marginal Cost of Capital may involve less calculation than WACC, however marginal cost may be calculated by incorporating tax rates, overhead, insurance or any other cost associated with acquiring the particular capital.</span>

4 0

3 years ago

. A firm begins the year with a Book Value of $10 million. During the year it generates $5 million in net profits. It paid $1 mi

Keith_Richards [23]

Answer:

b) $12 million

Explanation:

The new Book Value of the firm at the bigining of next year is $12 million.

In the calulation of Net Pfofit, Interst on loan has already been deducted, so deducting it from the total calculation will be wrong.

hence, only dividend paid will be removed from the addition of the Book Value anf the Net profit.

Closing balance = Opening Book Value + Net Profit - Dividend Paid

Note - The Net Profit is already ne of interest on loan.

Closing balance = $10 + $5 - $3

Closing balance is $12

3 0

3 years ago