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Alexxandr [17]
2 years ago
8

Suppose that Greece and Germany both produce oil and shoes. Greece's opportunity cost of producing a pair of shoes is 5 barrels

of oil, while Germany's opportunity cost of producing a pair of shoes is 11 barrels of oil.
1. By comparing the opportunity cost of producing shoes in the two countries, you can tell that _____ has a comparative advantage in the production of shoes and _____ has a comparative advantage in the production of oil.
2. Suppose that Greece and Germany consider trading shoes and oil with each other. Greece can gain from specialization and trade as long as it receives more than _____ of oil for each pair of shoes it exports to Germany. Similarly, Germany can gain from trade as long as it receives more than _____ for each barrel of oil it exports to Greece.
3. Based on your answer to the last question, which of the following prices of trade (that is, price of shoes in terms of oil) would allow both Germany and Greece to gain from trade?

a. 1 barrel of oil per pair of shoes
b. 17 barrels of oil per pair of shoes
c. 9 barrels of oil per pair of shoes
d. 10 barrels of oil per pair of shoes
Business
1 answer:
Mila [183]2 years ago
8 0

Answer:

1. Greece, Germany

2. 2.2 barrels of oil, 0.45 pairs of shoes

3. d. 10 barrels of oil per pair of shoes

Explanation:

a) Data and Calculations:

To produce a pair of shoes costs Greece 5 barrels of oil

To produce a pair of shoes costs Germany 11 barrels of oil

b) This means that it costs Germany more than Greece to produce a pair of shoes, and Germany produces a lot of oil to the extent that she is willing to exchange her 11 barrels of oil for a pair of shoes while Greece can only exchange 5 barrels of oil for a pair of shoes.

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Hi there !
Zanzabum

Answer:

Capital expenditures are typically one-time large purchases of fixed assets that will be used for revenue generation over a longer period while revenue expenditures are typically referred to as ongoing operating expenses, which are short-term expenses that are used in running the daily business operations.

6 0
2 years ago
Read 2 more answers
NewKirk Inc.., is an unlevered firm with expected annual earnings before taxes of $21 million in perpetuity. The current require
IrinaVladis [17]

Answer:

$11,895,000

Explanation:

Expected annual earnings before tax = $21,000,000

Debt issue = $30,000,000

Interest rate = 9%

Annual Interest expenses = $30,000,000 × 9%

= $2,700,000

EBT = EBIT - Interest expenses

= $21,000,000 - $2,700,000

= $18,300,000

Net income = $18,300,000 × (1 - 35%)

= $11,895,000

Cash flows available to equity holders after recapitalization will be $11,895,000.

8 0
3 years ago
Marwick Corporation issues 15%, 5 year bonds with a par value of $1,070,000 and semiannual interest payments. On the issue date,
Over [174]

Answer:

The bond's issue (selling) price = $1,146,890.2

Explanation:

The selling price of the bond is equivalent to the present value of all the cash flows that are likely to accrue to an investor once the bond is bought. These cash-flows are the periodic coupon payments that are paid semi anually and the par value of the bond that will be paid at the end of the 10 years.

During the 5 years, there are 10 equal periodic coupon payments that will be made. In each  year, the total coupon paid will be $1,070,000*0.15=$160,500 and this payment will be split into two equal payments equal to  \frac{160,500}{2}=$80,250. this stream of cashflows is an ordinary annuity

The periodic annual market rate is equal to \frac{0.13}{2}=0.065

The  PV of the cashflows = PV of the coupon payments + PV of the par value of the bond

=$80,250*PV Annuity Factor for 10 years at 6.5% + \$1,070,000*\frac{1}{(1+0.065)^10}

=$80,250*7.1888+$1,070,000*0.5327 = $1,146,890.2

7 0
3 years ago
On January 1, 2021, Red Flash Photography had the following balances: Cash, $25,000; Supplies, $9,300; Land, $73,000; Deferred R
Aleksandr [31]

Answer:

Red Flash Photography

a. Journal Entries:

1. Feb. 15:

Debit Cash $33,000

Credit Common Stock $33,000

2. May 20:

Debit Cash $48,000

Debit Accounts Receivable $43,000

Credit Service Revenue $91,000

3. Aug. 31:

Debit Salaries Expense $36,000

Credit Cash $36,000

4. Oct. 1:

Debit Prepaid Rent $25,000

Credit Cash $25,000

5. Nov. 17:

Debit Supplies $35,000

Credit Account Payable $35,000

6. Dec. 30:

Debit Dividends $3,300

Credit Cash $3,300

b. Adjusting Journal Entries:

a. Debit Salaries Expense $5,300

Credit Salaries Payable $5,300

b. Debit Rent Expense $6,250

Credit Prepaid Rent $6,250

c. Debit Supplies Expense $38,000

Credit Supplies $38,000

d. Debit Deferred Revenue $6,300

Credit Service Revenue $6,300

c. Income Statement for the year ended December 31, 2022:

Service Revenue                      $97,300

Salaries Expense      41,300

Rent Expense            6,250

Supplies Expense   38,000

Dividends                  3,300    $88,850

Net Income                               $8,450

d. Statement of Stockholders' Equity

For the year ended December 31, 2022:

Common Stock                          $96,000

Beginning retained earnings       38,000

Net Income                                     8,450

Dividends                                      (3,300)

Ending Equity                           $139,150

Explanation:

a) Data and Calculations:

Trial balance

Account Titles             Debit    Credit

Cash                       $25,000

Supplies                   $9,300

Land                       $73,000

Deferred Revenue                 $6,300

Common Stock                    $63,000

Retained Earnings               $38,000

Totals                 $107,300 $107,300

Analysis of Transactions:

1. Feb. 15: Cash $33,000 Common Stock $33,000

2. May 20: Cash $48,000 Accounts Receivable $43,000 Service Revenue $91,000

3. Aus. 31: Salaries Expense $36,000 Cash $36,000

4. Oct. 1: Prepaid Rent $25,000 Cash $25,000

5. Nov. 17: Supplies $35,000 Account Payable $35,000

6. Dec. 30: Dividends $3,300 Cash $3,300

Adjustments:

a. Salaries Expense $5,300 Salaries Payable $5,300

b. Rent Expense $6,250 Prepaid Rent $6,250

c. Supplies Expense $38,000 Supplies $38,000 ($9,300+35,000-6,300)

d. Deferred Revenue $6,300 Service Revenue $6,300

T-accounts:

Cash

Account Titles             Debit      Credit

Beginning balance    $25,000

Common stock            33,000

Service Revenue         48,000

Salaries                                      $36,000

Prepaid Rent                               25,000

Dividends                                      3,300

Ending balance                           41,700

Prepaid Rent

Account Titles             Debit    Credit

Cash                       $25,000

Rent Expense                         $6,250

Ending balance                       18,750

Accounts Receivable

Account Titles             Debit    Credit

Service Revenue    $43,000

Supplies

Account Titles             Debit      Credit

Beginning balance    $9,300

Accounts payable     35,000

Supplies Expense                     $38,000

Ending balance                           $6,300

Land

Account Titles             Debit      Credit

Beginning balance    $73,000

Deferred Revenue

Account Titles             Debit      Credit

Beginning balance                  $6,300

Service Revenue        $6,300

Accounts Payable

Account Titles             Debit    Credit

Supplies                                 $35,000

Salaries Payable

Account Titles             Debit    Credit

Salaries expense                   $5,300

Common Stock

Account Titles             Debit      Credit

Beginning balance               $63,000

Cash                                        33,000

Ending balance        $96,000

Retained Earnings

Account Titles             Debit      Credit

Beginning balance               $38,000

Service Revenue

Account Titles             Debit    Credit

Cash                                      $48,000

Accounts Receivable              43,000

Deferred Revenue                    6,300

Income Summary   $97,300

Salaries Expense

Account Titles             Debit    Credit

Cash                        $36,000

Salaries Payable         5,300

Income Summary                 $41,300

Rent Expense

Account Titles             Debit    Credit

Prepaid Rent            $6,250

Income Summary                 $6,250

Supplies Expense

Account Titles             Debit    Credit

Supplies                 $38,000

Income Summary                 $38,000

Dividends

Account Titles             Debit    Credit

Cash                         $3,300

Retained earnings                  $3,300

Adjusted Trial Balance

Account Titles               Debit      Credit

Cash                          $41,700

Prepaid Rent               18,750

Accounts receivable 43,000

Supplies                      6,300

Land                          73,000

Accounts payable                      $35,000

Salaries payable                             5,300

Common Stock                            96,000

Retained earnings                       38,000

Service Revenue                         97,300

Salaries Expense      41,300

Rent Expense            6,250

Supplies Expense   38,000

Dividends                  3,300

Totals                  $271,600     $271,600

7 0
2 years ago
YASHARI earns $27,000 per year, is single, and lives in Wyoming. She has $7000 in subsidized loans and another $19,000 in unsubs
Delvig [45]

Answer:

a) 14.43% ,  The amount is reasonable

b) Pay as you go

c) Yashari should should prioritize paying the Loan instalment before saving for the emergency fund

d) Standard repayment plan

Explanation:

Yashari Monthly take-home pay = $1850

<u>a) Determine the % of her paycheck goes toward student loans if she chooses standard repayment</u>

Rate of interest = 4.30%

hence % of her paycheck that goes toward student loan = 14.43%

The repayment amount = $32035. which is very reasonable as well

b) what plan that has the longest repayment period  

PAYE ( pay as you earn ) has the longest repayment period

<u>c)  prioritizing between her emergency fund goal and student loan </u>

Yashari should should prioritize paying the Loan instalment before saving for the emergency fund because of the penalties that comes with loan defaulting

d) Yashari should select the Standard repayment plan because the final amount paid using this plan is lower

4 0
2 years ago
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