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suter [353]
3 years ago
6

Question 1 OTU

Business
2 answers:
timurjin [86]3 years ago
7 0

Answer:

B. Company A has a comparative advantage in the production of

rakes

Explanation:

Alchen [17]3 years ago
3 0

Answer:

B. Company A has a comparative advantage in the production of

rakes

Explanation:

Comparative advantage describes the ability of an enterprise to produce a particular product, goods, or services at a lower price in comparison to rivals. It means that the enterprise uses fewer inputs such as labor, capital, or land to produce. A company with a comparative advantage will manufacture more goods with the same quantity of inputs.

Company A produces rakes at $15 while company B produces at $17.  Company A, therefore, has a comparative advantage over company B in the production of rakes. It means company A use fewer resources rakes than company B. Company A can sell rakes at a lower price than company B.

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Answer and Explanation:

a) Discount:

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Gain$30,637

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Dr Premium on Bonds Payable $20,621

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(Record retirement of bond at gain.)

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