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irakobra [83]
3 years ago
9

When China reformed state-owned enterprises, it tried a new approach to choosing managers: it put managerial jobs up for auction

. The bids for the jobs consisted of promises of future profit streams that the managers would generate and then deliver to the state. In cases where the incumbent manager was the winning bidder, firm productivity tended to increase dramatically. When outside bidders won there was little productivity improvement . Assumebthwt incumbent managers and new managers had similar qualifications.
True or False: this result stems from the information asymmetry between incumbent managers and outside bidders
Business
1 answer:
Dahasolnce [82]3 years ago
3 0

Answer:

True

Explanation:

Information asymmetry occurs when one of the two parties in a transaction has more information than the other. This causes the person that has the least information to likely make bad decisions.

In the question, we have an example of information asymmetry: incumbent managers simply have more information about the companies, because they have actually worked in managing them.

Outside managers, while as qualified as incumbent managers, do not have as much information about the companies, because they have not actually worked there.

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Database Systems is considering expansion into a new product line. Assets to support expansion will cost $750,000. It is estimat
Delvig [45]

Answer:

The net income is $150,500 and the return on assets is 20.06 %

Explanation:

The formula for computing net income and return on assets is shown below and the computation is also made.

Net income =  Sales revenue × Profit margin

                   = $2,150,000 × 7%

                   = $150,500

Return on assets = Net income ÷ total assets

                            = $150,500 ÷ $750,000

                            = 0.2006

                            = 20.06 %

Thus, the net income is $150,500 and the return on assets is 20.06 %

4 0
3 years ago
Brainliest Answer!! What Type of competitive situation is this?
Ann [662]

A. Pure competition

Pure competition describes a market with a wide range of competing businesses all selling the same product, in this case milk.

Monopolies are a single company running the market, and oligopoly markets have a small number of players who together control the vast majority.

5 0
3 years ago
______ is the process of dividing a market into distinct groups of buyers who have different needs, characteristics, or behavior
dimulka [17.4K]

Answer:

Market segmentation

Explanation:

Market segmentation is the process of dividing a market into distinct groups of buyers who have different needs, characteristics, or behavior.

The businesses use market segmentation to separate each market from another to study their demand closely. It helps them in catering to them according to their characteristics. They are able to treat every market according to its unique characteristics and generate more profit while doing that.

7 0
3 years ago
Common stocks have less security than ______________ stock, but it also has greater potential for reward.
Yuri [45]

Your answer is, Preferred.

<h3><u>What is a Preferred Stock</u></h3>

Preferred stock is a component of share capital that may have any combination of features not possessed by common stock, including properties of both an equity and a debt instrument, and is generally considered a hybrid instrument.

<h3><u>Impact of a Preferred Stock</u></h3>

Companies that offer preferred shares instead of issuing bonds can accomplish a lower debt-to-equity ratio. That allows them to gain significantly more future financing from new investors. A company's debt-to-equity ratio is one of the most common metrics used to analyze the financial stability of a business.

<h3><u>The 5 types of Preferred Stock</u></h3>
  • cumulative
  • participating
  • convertible
  • callable
  • adjustable-rate

Thus, <u>option c</u> is your answer.

Learn more about a Preferred Stock here: brainly.com/question/18068539

6 0
2 years ago
Jallouk Corporation has two different bonds currently outstanding. Bond M has a face value of $20,000 and matures in 20 years. T
eduard

Answer:

The price of the bond is $ 21,541.53  

Explanation:

The price of the bond is the present value of all cash inflows expected from the bond throughout the bond's life.

The cash inflows comprise of coupon interest interest payments as well as the repayment of the principal amount(the face value of $20,000) at redemption.

The present value is computed by multiplying the cash inflows by the discount factor.

The formula for discounting factor =1/(1+r/2)^t

r is the required yield of 5.4% divided by 2 since the coupon is payable twice a year.

Find attached.

Download xlsx
7 0
3 years ago
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