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Agata [3.3K]
3 years ago
5

Explain why a firm might want to continue operating and producing goods even after diminishing marginal returns have set in and

marginal cost is rising.
Business
1 answer:
ad-work [718]3 years ago
5 0

Answer:

Explanation:

Overall in a scenario such as this one, a firm may continue operating and producing goods if they believe demand may go back up and result in higher returns or if they expect the tastes of consumers to change in the near future. Both of these will in term cause the market sentiment surrounding the firm's product to change and begin seeing more profitable times. Otherwise, a firm would cut their loses and stop operating and producing goods.

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when attending a networking event, question 23 options: meet one person and make sure they understand what your business is. tel
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4 0
1 year ago
Quantitative Problem 1: Hubbard Industries just paid a common dividend, D0, of $1.50. It expects to grow at a constant rate of 2
mr Goodwill [35]

Answer:

The current price of Hubbard's common stock is <u>$25.50</u>.

Explanation:

This can be calculated using the Gordon growth model (GGM) formula that assumes growth is dividend will be constant as follows:

P = D1/(r - g) ............................ (1)

Where,

P = Current stock price = ?

D1 = Next dividend =  D0 * (1 + g) = $1.50 * (1 + 2%) = $1.53

r = required return = 8%, or 0.08

g = growth rate = 2%, or 0.02

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3 years ago
Three documents required by Department of Trade and Industry when registering a private company
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Identification
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