Calculation of opportunity cost

Which of the following home purchasing considerations will probably affect older homebuyers the least ?

lesya [120]

THEEEEEE

ANSWERRRRRR

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B

4 0

3 years ago

Assume that the level of capital flows between the U.S. and the country of Krendo is negligible (close to zero) and will continu

murzikaleks [220]

Answer:

Stronger

Explanation:

Given that inflation affects trade flows, as the higher price of commodities have negative impacts on exports rates. Thus, all things being equal, it is expected that high inflation should cause downward pressure on the exchanger rate of Krendo.

Hence, the inflation effect will be STRONGER than the interest rate effect in influencing the exchanger rate of Krendo against the U.S. dollar.

3 0

3 years ago

Sometimes one observes that the price of a company's stock falls after the announcement of favorable earnings. This phenomenon i

Nina [5.8K]

Sometimes one observes that the price of a company's stock falls after the announcement of favorable earnings. This phenomenon is consistent with the efficient markets hypothesis if the earning were not as high as anticipated

The efficient market hypothesis states that neither technical nor fundamental analysis can generate excess returns because new information in the market is immediately reflected in stock prices.

The efficient market hypothesis is a hypothesis in financial economics that states that asset prices reflect all available information. A direct consequence of this is that it is impossible to "beat" the market consistently on a risk-adjusted basis, as market prices should only respond to new information.

Learn more about efficient markets hypothesis here: brainly.com/question/14311423

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3 0

1 year ago

A company is experiencing lower than expected sales. The company’s executives agreed that in order to make up some of the lost r

kicyunya [14]

Answer:

a) The Common stockholder are the stakeholders

b) It is good business practice and ethical

c) $200,000 increase in income before tax

d) Advise the stakeholders based on the calculations made and effect on profit before tax.

Explanation:

The Question is divided into 4 parts and each will be answered as follows

a) Identify the stakeholders in the case: The stakeholders in such a case are the common stock holders.

The objective of any organization as well as its board of executives is to maximize the wealth of the stakeholders or shareholders. As such, any drag in sales will impact profit and lower profit means lower dividend or interest for stakeholders. Any decision taken therefore, will affect the common stock holders the most.

b) Determine whether the proposed change in assets’ useful life is unethical or good business practice?

The ethical nature of the proposed change in assets' useful life is based on how it affects industry practice

Since, its proposal will lead to the company's alignment with industry standard and practices, it means it is ethical and in line with good business practice

Furthermore, since it will lead to an increase in the company's dragging profits, then the common stock holders and every other stakeholder in the organization will have restored confidence in the company. Hence, it is both ethical and good business practice.

c) Determine the effects of executives’ proposed changes on the income before taxes for the year of proposed change?

Initial Depreciation/year ($4,400,000-$400,000)/ 8 $500,000

The proposed Depreciation ($300,000)

($4,400,000-$1,000,000-$400,000)= $3,000,000

$3,000,000/ (12 -2 years)= $300,000

The difference $200,000

This difference represents an increase in income before tax is deducted

d) State what you would do if you were in charge of making the change.

I will primarily advise the stakeholders based on the options available as follows:

If profitability is paramount, in order to ensure that stakeholders enjoy maximized wealth then, we should take the decision to change the depreciation estimates.

Of course, there is also the need to remind everyone that the increase in income before tax also leads to an increase in tax.

5 0

3 years ago

When the economy is experiencing an expansionan expansion automatic stabilizers will cause:

Sunny_sXe [5.5K]

Answer:

The transfer payments to decrease and tax revenues to increase.

Explanation:

An automatic stabilizer is a fiscal policy tool that is used to correct the fluctuations in the economy through its normal working without any further government intervention. In case of expansion it increases taxes and reduces government spending.

An increase in the tax rates will increase the tax revenues of the government. At the same time, a reduction in government spending will decrease the transfer payments paid by the government.

3 0

3 years ago

Calculation of opportunity cost​

Calculation of opportunity cost