When milk has an absolute advantage in the production of two goods over Tommy, Milk IS MORE PRODUCTIVE IN PRODUCING BOTH GOODS THAN TOMMY.
A country or an individual is said to have absolute advantage in producing a good if the person can produce the good more efficiently economic wise.
Answer:
775 units
Explanation:
By forecast,
June sales = 400 units
July sales = 700 units
if ending inventory equal to 125% of next month's sales
Then June's ending inventory = 125% × 700
= 875 units
May's ending inventory = 125% × 400
= 500 units
Opening inventory + production - sales = closing inventory
Using the formula above, where p = production
500 + p - 400 = 875
p = 875 - 100
p = 775
Production required for June is 775 units.
Answer:
A bank acts like an intermediary between depositors and creditors. If the market interest rates increase, gross interest income will rise, but all gross interest expense. They will charge higher rates to borrowers, but also must pay higher rates to depositors. The spread probably remains unchanged because both sides increased.
Answer: Po = Do(1+g)/Ke-g
Po = $3.10(1-0.109)/0.13 - (-0.109)
Po = $3.10(0.891)/0.13+0.109
Po = $3.10(0.891)/0.239
Po = $11.56
Explanation: The current market price of the stock equals the current dividend paid multiplied by 1+g divided by the excess of cost of equity over growth rate. The growth rate is negative in this case, thus, the growth rate would be deducted from 1. Moreso, the growth rate will be added to cost of equity since it is negative. Thus, the amount that the investor will be willing to pay is $11.56.
