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bagirrra123 [75]
3 years ago
10

Why would a monopolistically competitive firm​ advertise? A monopolistically competitive firm would advertise to A. shift its de

mand curve to the left. B. decrease the price it charges. C. make its demand curve more inelastic. D. reduce the total cost of production. E. reduce product differentiation.
Business
1 answer:
kompoz [17]3 years ago
5 0

Answer:

C) Make its demand curve more inelastic

Explanation:

A product is inelastic if the demand for it does not change a lot when price changes. For example, gasoline is a perfect example of a good with inelastic demand because customers buy gasoline even if the price rises.

A firm will always want to have inelastic products because this will assure revenue even if production costs have to be raised, and the sales price therefore increases.

Advertising can achieve that by increasing brand loyalty, product differentiation, or good perception about the product. Customers may feel that no matter how high the price is, the product is worth it.

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The numerator of the return on common stockholders' equity is_____________. a.income before income tax b.operating income minus
elena-s [515]

The numerator of the return on common stockholders' equity is net income minus preferred dividends.

Option d

<u>Explanation:</u>

Return on common stockholders' equity which is also named as return on equity (ROE) ratio evaluates the accomplishment of a company in resulting income for the benefit of common stakeholders.

<em>Use of return on equity:</em>

  • Isolates common equity returns
  • Can be used to evaluate dividends
  • Evaluates the use of capital by the management

It is calculated by income available for stockholders divided by the total number of common stock and is expressed or represented in percentage. Income available for common stockholders can be arrived by reducing preference dividends from Net income.

That is, \text { Net income }-\text { Preference dividends }=\text { Equity available for common stockholder }

Hence, net income minus preferred dividends is the right answer.

3 0
3 years ago
The slope of the investment demand function indicates how sensitive investment is to changes in real interest rates. The 'steepe
Alex17521 [72]

The correct answer is false.

It is false that the slope of the investment demand function indicates how sensitive investment is to changes in real interest rates. The 'steeper' the investment demand function, the less sensitive investment is to changes in the real rate of interest, all else constant.

We can say that the downward slope is the consequence of several reasons. For instance, the concept that money, its nominal value, is fixed. However, the real value of money depends on the level of prices. So the demand for money is related to the demand for it. The interest rate falls when the price level falls.

7 0
3 years ago
Assume the price of gasoline doubles tonight and remains at that price the next two years. The price elasticity of demand for ga
enyata [817]

Answer:

The correct answer is letter "D": more inelastic.

Explanation:

When its price changes, the supply, and demand for an inelastic good or service are not dramatically impacted. Whether the price of an inelastic product goes up or down, the buying habits of consumers remain roughly the same. <em>Prescription drugs, food, clothing, </em>and <em>gasoline</em> are common examples of inelastic goods.

Thus, <em>if the price of gasoline doubles tonight, that price would be considered more inelastic tomorrow compared to the current price until today than comparing the doubled price during the course of the upcoming two years</em>.

6 0
3 years ago
You have just inherited $560,000. You plan to save this money and continue to live off the money that you are earning in your cu
suter [353]

Answer:

10.64 years

Explanation:

To find the number of years , use this formula :

FV / PV = (1 + r) ^n

FV = Future value  = $1 million

P = Present value  = $560,000.

R = interest rate  = 5.6%

N = number of years  

$1,000,000 / $560,000 = (1.056)^n

1.785714  = (1.056)^n

Find the In of both sides

n = 10.64 years

6 0
3 years ago
Mia and Jack are two chocolate producers. Mia packs her chocolates in attractive boxes and charges slightly more than Jack does.
Rama09 [41]

The correct answer is B. Monopolistic competition

Explanation:

Monopolistic competition occurs when the producers of a product determine the price of it. Also, the products sold have differences, which means consumers do not consider one product can be substituted by another because the qualities, brand, appearance, etc. are different. This is the opposite of perfect competition, in which products are substitutes and price is determined by price and demand rather than producers.

Monopolistic competition occurs in the case presented because the chocolates sold by Jack are different from those sold by Mia, who uses attractive boxes. Also, due to this difference, Mia can set higher prices and still get more demand from consumers.

6 0
3 years ago
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