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2 years ago

Which of the following represents a market failure?

Business

1 answer:

Marat540 [252]2 years ago

7 0

Answer:

a. Shopping for used cars when the seller has private information about the car unavailable to the buyer

Explanation:

When the market is not able to produce an efficient quantity, then it is said that market is failed. This might happens due to many reasons and asymmetric information is one of them. When there is an asymmetric information, then the sellers of the used car have information about it, but the buyer do not have the full information about the used car.

Hence this leads to inefficient outcome and therefore market fails.

Hence it can be said that a market failure example is Shopping for used cars when the seller has private information about the car unavailable to the buyer.

Hence option first is the correct answer.

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2 years ago

A homeowner desires to sell his or her home and signs an exclusive-listing agreement, requiring payment of a six percent commiss

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Answer: B. must pay a commission of $24,000 to the listing agent.

Explanation:

An exclusive listing agreement is a contractual agreement whereby a listing broker acts as the agent and in this case, the seller will pay a commission to the listing broker.

Since the homeowner has already signed an exclusive-listing agreement, which requires payment of 6% commission to the real estate agent but later finds a couple who purchases it for $400,000. In this case, the homeowner must still funlfil the terms of the contact and pay the listing agent the percentage that was agreed as commission and this will be:

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3 years ago

A motor vehicle sold on credit to C. Kelly will require which of the following entries:

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When a motor vehicle is sold to C. Kelly on credit, the relevant entries would be Debit C. Kelly, Credit Motor vehicle.

When an item is sold on credit to an entity, that entity becomes an Accounts Receivable. As this is an asset, it is debited when it increases which is the case here with C. Kelly purchasing the car on credit.

The motor vehicle account is an asset and assets are credited when they decrease. By selling the vehicle, the motor vehicle account will be credited to show that motor vehicles have decreased.

In conclusion, the accounting entry for the above scenario would be Debit C. Kelly, Credit Motor vehicle.

Find out more at brainly.com/question/20519391.

4 0

2 years ago

A portfolio is composed of two securities, Stock X and Stock Z. Stock X has a standard deviation of returns of 35%, while Stock

emmainna [20.7K]

Answer:

Portfolio SD = 0.18439 or 18.439%

Explanation:

The standard deviation of a stock or a portfolio is the measure of the total risk contained in the stock or portfolio. Risk can be defined as the volatility of the stock returns. To calculate the standard deviation of a two stock portfolio, we use the attached formula.

If the weight of stock x is 40%, the weight of stock y will be 1 - 40% = 60%

SD = √(0.4)^2 * (0.35)^2 + (0.6)^2 * (0.15)^2 + 2 * 0.4 * 0.6 * 0.25 * 0.35 * 0.15

SD = 0.18439 or 18.439%

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