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Scorpion4ik [409]
3 years ago
9

If a consumer buys flour because he loves baking, the flour is counted as part of GDP. If a bakery buys flour as an input to bak

e things in order to sell, the flour is not counted as part of GDP. Briefly explain why we treat these purchases differently.
Business
1 answer:
Nezavi [6.7K]3 years ago
6 0

<u>Explanation:</u>

<em>Remember,</em> the GDP (Gross Domestic Product) is an economic term that refers to the total value of goods and services produced in an economy in a particular period, usually in a period of one year.

Note, the standard way of counting GDP tries to avoid double counting by noting only the final value of goods or services.

Hence, the flour bought by the consumer (the final user) is measured by the producer as output or goods produced, whereas If a bakery buys flour as an input to bake things in order to sell, the flour is not counted as part of GDP because it is not the final value of the goods as value is still going to be transferred to whatever output from the bakery (eg bread, cakes).

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storchak [24]

Answer:

The insurance company will pay the mortage of $400,000

Explanation:

Loan value = 96%* $500000

                   = $480000

75% LTV value = $375000

Portion of loan over 75% LTV= $105000.

This is the amount insured.

5 years later, Sam needs $400000 more to pay. But he defaults.

And he has only paid $100000 of mortgage loan.

So, insurance company will pay the remaining balance of the amount insured to Sam's lender.

Therefore, The insurance company will pay the mortage of $400,000.

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3 years ago
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Gross investment exceeds depreciation
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4 years ago
Blue Horizon Inc. is an Internet service provider. It provides a router free of charge when users sign up for a two-year wireles
ale4655 [162]

Answer:

The correct answer is the option C: a combination of the freemium business model and the pay-as-you-go business model.

Explanation:

On the one hand, the <em>freemium business model</em> is a way of ensuring future business transactions that a company can use by allowing users to utilize basic features of the service, such as in this case the router.

On the other hand, <em>the pay-as-you-go business model</em> is a way that the company can charge their customer and it does it by requesting the payment of the service in advanced of the use, no matter how much they use it.

In conclussion, Blue Horizon Inc is using a combination of both the freemium model and the pay-as-you-go model due to the fact that they offer a free router for their customer but they pay the service of internet in advanced as well.

7 0
3 years ago
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Which of the following options strategies would be best for an investor interested in maintaining his long position in the marke
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Answer:

buying puts

Explanation:

A put option is a sale option. It gives the buyer the right (but not the obligation) to sell an asset in the future to the seller of the option at a previously determined price.

The owner or buyer of a put option benefits from the option if the underlying asset falls, that is, if when the put option expires, the asset (a share for example) has a price lower than the agreed price . In that case, the option buyer will exercise his right and sell the asset at the agreed price and then buy it at the current market price, earning the difference.

If the price turns out to be higher than the agreed price, known as the strike or strike price, the buyer will not exercise his right and will simply have lost the premium he paid to acquire the option. Therefore, your benefit may be unlimited, but your loss is limited to the premium you paid.

8 0
4 years ago
Identify whether each account would appear on the Balance Sheet or the Income Statement.
Greeley [361]

Answer:

The income statement shows the income items and expense items that are earned by a company for an accounting period. The balance sheet shows assets, liabilities, and the ending balances of equity items. The statement of changes in stockholders equity shows the changes of equity accounts, such as retained earnings and common stock, from its beginning balance to its ending balance.  The statement of cash flows shows the inflow and outflow of cash for an accounting period.

Explanation:

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