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maks197457 [2]
3 years ago
15

Hotco oil burners, designed to be used in asphalt plants, are so efficient that Hotco will sell one to the Clifton Asphalt plant

for no payment other than the cost savings between the total amount the asphalt plant actually paid for oil using its former burner during the last two years and the total amount it will pay for oil using the Hotco burner during the next two years. On installation, the plant will make an estimated payment, which will be adjusted after two years to equal the actual cost savings.
Which of the following, if it occurred, would constitute a disadvantage for Hotco of the plan described above?
A) Another manufacturer’s introduction to the market of a similarly efficient burner
B) The Clifton Asphalt plant’s need for more than one new burner
C) Very poor efficiency in the Clifton Asphalt plant’s old burner
D) A decrease in the demand for asphalt
E) A steady increase in the price of oil beginning soon after the new burner is installed
Business
1 answer:
dlinn [17]3 years ago
5 0

Answer:

Hotco

If it occurred, this would constitute a disadvantage for Hotco of the plan described above:

E) A steady increase in the price of oil beginning soon after the new burner is installed.

Explanation:

A steady oil price increase commencing soon after the new burner is installed will obliterate the actual cost savings from which Clifton Asphalt would be paying Hotco for the oil burners.

This is buttressed by the fact of the payment terms that totally depends on the cost savings.

Even the adjustment after two years may not benefit Hotco if the steady increase in the price of oil persists.

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Answer:

SCC won't pay any tax

Explanation:

Their loss of $30,000 in year 1 will be unused and made available to counterbalance the total generated earnings in year 2.

The $20,000 earnings in year 2 can be used to counterbalance the whole taxable income; so, SCC will not pay pay tax. SCC will have a ($10,000) loss carryover available for year 3 and beyond

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The capital-to-labor ratio is:Question 40 options:a) a key element in decreasing real wages.b) high in rich countries.c) the rat
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Answer:

b) high in rich countries.

Explanation:

Capital-to- labour ratio measure the degree of capitalisation of an economy.

Labour is the service that is given by workers in exchange for salaries in the production process.

Capital is the long term input that is put into the manufacturing process, usually in the form of machinery or systems that automate production.

Capital-to-labour ratio= Total capital/ Total labour

Rich countries have a high level of capitalisation of their production process, where a lot of activity is automated. So capital is high and labour input is low. This results in a high capital-to-labour ratio.

On the other hand poor countries are more labour inensive, so their capital-to-labour ratio is low.

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Suppose an economist tests the theory that when the price of leather increases, fewer pairs of shoes are produced. He observes m
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<h3>What is an economist?</h3>

Generally, an economist is simply defined as a professional in economics.

In conclusion, To illustrate, "let's say an economist investigates the hypothesis that higher leather costs lead to fewer shoe purchases." Since his findings contradict the ceteris paribus premise, his hypothesis cannot be tested.

Read more about economist

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