Over time, the average consumer will be better off from reduced trade barriers by lower prices.
- Comparative advantages allow countries to manufacture the goods at which they are experts.
- A is skilled at making delicious wine, and they can do so for less money than B while still creating a wine of higher quality.
- When trade obstacles are lowered, wine from country A will be sold in country B, customers will have more wine options available to them, and prices will be substantially less different than they are when strong barriers are in place.
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Answer:
1.
<u>Net income increases</u><em>. - </em>Ability to pay Dividends increases.
Dividends are paid from Retained Earnings which are derived from Net Income. If Net income increases therefore, so does the ability to pay Dividends.
<u>More profitable investment opportunities are available</u> - Decreases Ability to pay Dividends.
If there are more profitable opportunities for investment available, the business will invest in those opportunities. By doing so they will reduce the amount of cash that they have which is cash that could have been paid as dividends.
<u>The firm increases its debt ratio</u>. - Ability to pay Dividends Increase
As a result of the company borrowing more money, there will be more money left to pay out dividends so more dividends will be paid.
2. A. Despite the fact that Dernham Burnham Inc.'s earnings tend to fluctuate from year to year, the company most likely pays a predictable, stable dividend each year.
Companies like Dernham that aim to please investors usually adopt a predictable, stable dividend policy every year so that the investors will have more faith in them and be sure of earnings every year. This will give them a higher rating with the investors.
Answer:
A $3066000
Explanation:
The formula for cash received from customers is: opening receivables+net sales-closing receivables.
The rationale behind the formula is that opening receivables would have turned cash by year end since current asset last one year maximum.
=$241500+$3097500-$273000
=$3066000
Expensive cost affected market out put decision
Answer:
<u>Allocative efficiency </u>
Explanation:
Marginal benefit refers to the extra satisfaction derived from purchase of an extra unit of a good or a service.
Marginal cost refers to the extra cost incurred when an additional unit of a good or a service is produced.
When marginal cost is equal to the marginal benefit, it is the most efficient situation wherein optimal blend of commodities is produced.
Allocative efficiency refers to producers providing that blend of goods which are most desired by the society at the optimal level of production.
