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SVEN [57.7K]
2 years ago
7

Suppose that a cafe enjoys a large increase in customers whenever the jazz club next door features a band playing appealing musi

c because it can be easily heard from the cafe. The jazz club owner decides to purchase the cafe so that he can internalize this positive externality. Which of the following types of private solutions to the externality of appealing music has occurred in this case?
a. Contracts
b. Charities
c. Moral codes and social sanctions
d. Integration of different types of businesses through merger or acquisition
Business
1 answer:
ExtremeBDS [4]2 years ago
7 0

Answer:

D. Integration of different types of businesses through merger or acquisition

Explanation:

Externalities occur when the production or consumption of a particular good or service affects a third-party who is not related to the transaction. A positive externality is one that is favorable and beneficial to the third party and a negative externality is one that is unfavorable and creates a cost to the third party. In this case, the third party is the owner of the cafe and it is a positive externality because the music creates an increase in the number of customers to his/her business.

When the jazz club owner purchases/acquires the cafe, the cafe becomes his. Hence, the benefit felt to the cafe by the music from the jazz club is a benefit that his own new business incurs. Thus, the integration of these two businesses into one helps internalize the positive externality since now the main party involved in the transaction is also the one feeling the positive externality and not a third-party as used to be.

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For the following investments, identify whether they are: Trading debt securities. Available-for-sale debt securities. Held-to-m
AnnyKZ [126]

Answer:

(a) A bond that will mature in 4 years was bought 1 month ago when the price dropped. As soon as the value increases, which is expected next month, it will be sold.  - <u>Trading Debt Securities</u>

Trading debt securities such as these are held only for a short time before they are sold with the goal being short term profit.

(b) 10% of the outstanding stock of Farm-Co was purchased. The company is planning on eventually getting a total of 30% of its outstanding stock.  - <u>None of the Above</u>

This is an Equity Investment.

(c) Bonds were purchased in December of this year. The bonds are expected to be sold in January of next year.  - <u>Trading Debt Securities</u>

Like the bond in (a), this is being held for a short while only and then it will be sold so it is a Trading debt security.

(d) Bonds that will mature in 5 years are purchased. The company would like to hold them until they mature, but money has been tight recently and they may need to be sold.  - <u>Available-for-sale debt securities</u>

Available for sale debt securities are to be sold before maturity and therefore have no certain selling time. The bond above has no selling time as it might be sold at any point so it is an Available-for-sale debt security.

(e) Preferred stock was purchased for its constant dividend. The company is planning to hold the preferred stock for a long time.  -<u> None of the above.</u>

This is an Equity investment as well.

(f) A bond that matures in 10 years was purchased. The company is investing money set aside for an expansion project planned 10 years from now. - <u>Held-to-maturity debt securities.</u>

Held to Maturity bonds are bought with no intention of selling and the company hopes to hold them till they mature like this bond which will be held for 10 years.

7 0
2 years ago
What amount needs to be invested today at 6% simple interest in order to have $4000 in 2 years?
garri49 [273]
Data:
A (amount) = ?
P (Principal) = $ 4000
r (rate) = 6% → 0.06
t (time) = 2 years

Formula:
A = P(1+r*t)

Solving:
A = P(1+r*t)
A = 4000(1+0.06*2)
A = 4000(1+0.12)
A = 4000*1.12
\boxed{\boxed{A = \$\:4480}}\end{array}}\qquad\quad\checkmark


4 0
3 years ago
Big Sky Sports sells hunting and fishing equipment and provides guided hunting and fishing trips. Big Sky Sports is owned and op
stiv31 [10]

Answer:

(a)

1. Kalispell State Bank

2. Glacier Boutique

3. Big Sky Sports

4. Kalispell State Bank

5. Big Sky Sports

6. Big Sky Sports

7. None of the above

8. Glacier Boutique

9. None of the above

10. Big Sky Sports

(b) Business transactions refers to the transactions that are related to only business, such as purchase of land, machinery, goods for business purposes. Any type of personal transaction is not included in business transaction.

6 0
2 years ago
Bodin Company manufactures finger splints for kids who get tendonitis from playing video games. The firm had the following inven
Ilia_Sergeevich [38]

Answer:

Raw Material $191,000

Direct labor $300,000

Actual manufacturing overhead $170,000

Actual selling and administrative expenses $115,000

The company applies manufacturing overhead at the rate of 60 percent of direct-labor cost.

1.

Prime Cost = Direct Material + Direct Labor

Prime Cost = $191,000 + $300,000 = 491,000

2.

Cost of goods manufactured                                    $

Direct material                                                      $191,000

Add: Direct Labor                                                $300,000

Add: Manufacturing overhead                           <u>$170,000</u>

Manufacturing cost                                             <u>$661,000</u>

3.

Manufacturing cost                                             $661,000

Add: Work in process inventory at January 1    $235,000  

Less: Work in process inventory at January 31 <u>$251,000</u>

Cost of Goods Manufactured                             <u>$645,000</u>

4.

Cost of Goods Manufactured                             $645,000

Add: Finished Good inventory at January 1      $125,000  

Less: Finished Good inventory at January 31   <u>$117,000</u>

Cost of Goods Sold                                            <u>$653,000</u>

5.

Manufacturing overhead Account Balance

Actual overhead                = $175,000

Manufacturing overhead   = $180,000  (300,000 x 60% )

Over applied manufacturing overhead = $180,000 - $175,000

Over applied manufacturing overhead = $5,000

* Data was missing for the calculations, complete question is attached with this answer, Please find that.

3 0
3 years ago
compared with the network evening news shows (those on abc, nbc, and cbs), cable news stations such as msnbc, fox news, and cnn
Orlov [11]

While network evening newscasts have stayed fairly constant throughout the years, the news programs that Americans watch on local television stations and national cable channels have altered substantially in recent years.

<h3>What change has been noticed?</h3>

Local television newscasts have recently emphasized traffic, weather, and sports, even more, aired less edited package stories, and cut the lengths of stories—trends that might be a result of the industry's current economic challenges.

There is a growing fear that local TV news may be suffering some of the financial difficulties that have already hammered the newspaper sector as younger people are tuning out local newscasts.

Learn more about local television, from:

brainly.com/question/5418404

#SPJ1

5 0
1 year ago
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