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Leya [2.2K]
3 years ago
12

After the formation of a free trade area for its member countries, the United States found that its high-cost furniture producer

s in North Carolina were replaced by low-cost producers from another country within the free trade area. This is an example of ________.
Business
1 answer:
Damm [24]3 years ago
6 0

Answer: Trade creation

Explanation:

Trade creation is the increase in economic welfare which occurs when a country joins a free trade area, like the customs union. Trade creation will happen when the ltariff barriers has been reduced which leads to lower prices.

Trade creation leads to lower cost on producers which will lead to a rise in economic welfare and consumer surplus. Trade creation also leads to expansion of trade.

You might be interested in
Suppose that your marginal federal income tax rate is 30%, the sum of your marginal state and local tax rates is 5%, and the yie
snow_tiger [21]

Answer:

Option (B) is correct.

Explanation:

Given that,

Marginal federal income tax rate = 30%

Sum of your marginal state and local tax rates = 5%

Yield on thirty-year U.S. Treasury bonds = 10%

Municipal bond has a yield:

= U.S Treasury bonds × (1 - tax)

= 10% × (1 - 30%)

= (10 ÷ 100) × [1 - (30 ÷ 100)]

= (10 ÷ 100) × (70 ÷ 100 )

= (1 ÷ 10) × (7 ÷ 10 )

= (7 ÷ 100)

= 7%

3 0
3 years ago
Stephanie, a manager, came into your office last week to complain about her employees. "I just don’t get the respect I deserve,"
Grace [21]

Answer:

A. Coercive

Explanation:

Stephanie, the manager seems to be demanding respect from her subordinates in a forceful way.

To coerce means to persuade an unwilling person to do something by threats or force.

Stephanie is frustrated because her method of coercion has failed to work on her subordinates so she has gone to report to a higher authority.

8 0
3 years ago
What should be the price of a common stock paying $3.50 annually in dividends if the growth rate is zero and the discount rate i
katrin [286]

Answer:

$43.75

Explanation:

Dividend discount model with zero growth assumes that the Company shall continue to pay the same amount of dividend in infinity. The formula for calculating price of such stock is

Price = Annual Dividend / Discount rate

Price = $3.5 / 8%

Price = $43.75 / per share

3 0
3 years ago
Chav has taken her employees for a team-building lunch. The final bill is $92.50. How much should Chav leave for a 20% tip?
Shtirlitz [24]

Answer:

  • <u>$18.50</u>

Explanation:

To calculate the<em> tip</em> you must multiply the bill by the percentage and divide by 100.

This is:

  • Tip = % tip × final bill / 100

  • Tip = 20% × $92.50 / 100 = $18.50 ← answer

Then, Chav should leave $18.50 for a <em>20% tip.</em>

Also, notice that when you receive the bill you should find the total before taxes and calculate the tip over such total without taxes.

In this problem, you are only given the final bill, then you cannot discriminate the value of the meal as such so you use the total value of the bill.

7 0
3 years ago
Knowledge Check 01 Identify the simplifying assumptions usually made in net present value analysis. (You may select more than on
steposvetlana [31]

Answer:

All cash flows other than the initial investment occur at the end of periods.

All cash flows generated by the investment project are immediately reinvested at a rate of return equal to the discount rate.

Explanation:

Net present value method: In this method, the initial investment is subtracted from the discounted present value cash inflows. If the amount comes in positive than the project is beneficial for the company otherwise not.

In the net present value, the yearly cash flows other than the initial investment is occur at the end of the period as all the yearly cash flows are discounted at the present value factor.

And, the discount rate is equal to the rate of return

So, these two statements are correct.

6 0
3 years ago
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