Answer:
A
Explanation:
Price ceiling is when the government or an agency of the government sets the maximum price for a product. It is binding when it is set below equilibrium price.
Consumer surplus is the difference between the willingness to pay of a consumer and the price of the good.
Consumer surplus = willingness to pay – price of the good
Producer surplus is the difference between the price of a good and the least price the seller is willing to sell the product
Producer surplus = price – least price the seller is willing to accept
Because price is below equilibrium price, consumer surplus would increase and producer surplus would reduce
Answer:
b) fall to 8 percent.
Explanation:
First, irrespective of the duration of the bond, if the price is equal to the bond's face value, it means that the coupon rate is equal to the yield to maturity (YTM).
Initial YTM = 10%
Since this is a perpetually coupon paying bond, you use PV of perpetuity to find the rate;
PV = Coupon PMT / rate
Given PV as $1,250, new annual rate would be;
1,250 = 100/rate
solve for rate by cross multiplying;
1,250rate = 100
divide both sides by 1,250
rate = 100/1,250
rate = 0.08 or 8%
Therefore, the
interest rate would fall to 8 percent.
Answer
The answer and procedures of the exercise are attached in the following image.
Explanation
Please consider the data provided by the exercise. If you have any question please write me back. All the exercises are solved in a single sheet with the formulas indications.
Answer:
depreciation expense equipment 610 debit
accumulated depreciation equipment 610 credit
utilities expense 390 debit
utilities payable 390 credit
rent expense 700 debit
prepaid rent 700 credit
insurance expense 468 debit
prepaid insurance 468 credit
wages expense 965 debit
wages payables 965 credit
interest receivables 300 debit
interest revenue 300 credit
Explanation:
(C) rent calculations
2,800 --> four period of rent
2,800 / 4 = 700 per period
(D) insurance calculations
624 for the entire years
expired 9 months in this period
$624 x 9/12 = 468