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Eddi Din [679]
3 years ago
8

When the price of an inferior good​ falls, the substitution effect leads to​ ________ in the quantity purchased and the income e

ffect leads to​ ________ in the quantity purchased.
a. an​ increase; an increase
b. a​ decrease; an increase
c. a​ decrease; a decrease
d. an​ increase; a decrease?
Business
1 answer:
hammer [34]3 years ago
4 0
When the price of an inferior good falls, the substitution effect leads to an increase in the quantity purchased and the income effect leads to a decrease in the quantity purchased. 

An inferior good is something consumers would purchase only if they had more income so if the price falls, customers are able to afford to use this product as a substitute to an item of lower price that they currently purchase. 
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You plan on purchasing the stock of Red Cigars Inc. and you expect it to pay a dividend of​ $3.15 in 1​ year, $3.55 in 2​ years,
Musya8 [376]

Answer:

Price of stock = $78.143

Explanation:

According to the dividend valuation model , the current price of a stock is the present value of the expected future dividends discounted at the required rate of return.  

So we will discount the steams of dividend using the required rate of 11.0% as follows

Price of stock =3.15 × 1.11^(-1)  +3.55× 1.11^(-2) +4.05 1.11^(3)  +95× 1.11^(-3)

=78.143

Price of stock = $78.143

3 0
3 years ago
If the standard deviation of returns from an investment is zero, then: the risk associated with the investment is more than that
MariettaO [177]

Answer:

the expected return from the investment is higher than that of those investments whose standard deviation is greater than zero.

Explanation:

As for the coefficient of variation which clearly defines the difference in values from the mean value in the data set.

It clearly defines as standard deviation/mean.

Where standard deviation is 0 the coefficient will also be 0 which shall represent the risk associated with it.

The least the coefficient of variation the least the risk with maximum return.

Thus, the correct statement will be concluding that the expected return from this investment will be higher than the returns from the project in which standard deviation is more than 0.

3 0
3 years ago
The separation of the ownership of the firm from the control of the firm leads to: ____________
murzikaleks [220]

Answer:

D. Equity financing

Explanation:

Hope this helps!

3 0
3 years ago
Which of the following statements regarding a monopolist is false? A. The marginal revenue cure lies below the demand curve for
Sati [7]

Answer:

C. The monoplist sets price equal to marginal cost to maximize profit.

Explanation:

To maximise the profit, monopolist charge price where MR = MC.

3 0
3 years ago
On December 31, 2020, Flint Corporation sold for $150,000 an old machine having an original cost of $270,000 and a book value of
dalvyx [7]

Answer:

$105,547

Explanation:

Original cost of machine = $270,000

Machine sold for = $150,000

Book value = $120,000

Down payment = $30,000

$60,000 payable on December 31 each of the next two years .

Present value of an ordinary annuity of 1 at 9% for 2 years = 1.75911

The amount of the notes receivable net of the unamortized discount:

= Amount paid on December 31st ×  Present value of an ordinary annuity

= $60,000 × 1.75911

= $105,547

3 0
3 years ago
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