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djverab [1.8K]
3 years ago
12

A supermarket sells kiwis at a price of 33 cents each. Then it starts selling the same product at the price of 3 kiwis for 99 ce

nts. The manager observes that the sales are higher under the new policy. This behavior is best described as (A) mental accounting; (B) satisficing; (C) anchoring; (D) a context effect.
Business
1 answer:
Lostsunrise [7]3 years ago
5 0

Answer:

C. Anchoring

Explanation:

The first price to be mentioned will have an effect on the perception of all future prices. If we start with $200, then $100 will seem cheap, but £1000 seem expensive. But if we start with $10, then $100 will seem expensive.

The anchor for a price perception may be found in the first price mentioned. It can also arrive in the mind of the purchaser, where the anchor may have been set by previous experience.

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Suppose stocks offer an expected rate of returns of 10% with a standard deviation of 20%, and gold offers an expected return of
FinnZ [79.3K]

Answer: A)  (i) will; (ii) will not

Explanation:

The optimal portfolio should be one where the assets are diversified such that returns can be made regardless of the direction the economy is going. For this to happen, asset classes need to have a low correlation with one another.

If the correlation between gold and stocks is low therefore, gold should and will be held as a component in the portfolio. If the correlation between gold and stocks is 1.0 - this means that they are perfectly correlated and move together - gold should not be in the optimal portfolio as it would be too risky.

4 0
3 years ago
Due to the nature of the patent laws on pharmaceuticals, the market for such drugs A. switches from monopolistic to competitive
bija089 [108]

Answer:

B

Explanation:

B:  switches from competitive to monopolistic once the firm's patent runs out.

7 0
3 years ago
The Modigliani and Miller hypothesis suggests that capital structure doesn't matter. All of the following conditions need to be
Dmitriy789 [7]

Answer:

The false statement is letter "B": all corporate net income is paid out as dividends.

Explanation:

The Modigliani-Miller Theorem or M&M is used in financial and economic studies to analyze the value of a firm such as a business or a corporation. The M&M theorem states that a firm's value is based on its ability to earn revenue plus the risk of its underlying assets. This value is independent of the way the company distributes its profits or finances its operations.

In that case, dividends have nothing to do with how the M&M theorem values a business.

6 0
3 years ago
Which one of the following methods of analysis is most appropriate to use when two investments are mutually exclusive?Internal r
ozzi

Hello there!

Answer:

Your answer would be "Net present value"

Explanation:

The reason why "Net present value" would be the correct answer is because this is the method that is specifically used when two investments are mutually exclusive. What "mutually exclusive" means is that something can't occur, or happen, at the same time. What this sentence is saying is that two investments can't happen at the same time. A "Net present value" is the value of the money that is currently present, while being contrasted into future value when it is invested in, specifically in compound interest. What people would use "Net present value" for when two investments are mutually exclusive is to see how much value the different investments will bring, and see which investment they would want to choose first, specifically for profit wise. This is the reason why net present value would be correct.

4 0
3 years ago
Courtney is the finance head of a tourism company. Recognizing that the company is hard-pressed financially, she decides to canc
denis23 [38]

Answer:

Option D is correct. Concentrating resources on areas that need the most change

Explanation:

Because the Finance head is trying to increase the returns on the reliable projects that has tendency to increase returns by minor investments. This will ensure secure future for the company and efficient working of the operations of the company.

Furthermore vision is associated with the company mission and personal brand and building trust takes a lot of time. And also that the romanticizing risk means the finance head is thinking to take the risk because the company can bear these risks.

5 0
3 years ago
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