The direct income capitalization model employs an infinite time horizon.
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What is time horizon?</u></h3>
- A time horizon, sometimes referred to as a planning horizon, is a set point in the future where specific activities will be assessed or taken to have concluded.
- Assigning such a defined horizon time is important in an accounting, financial, or risk management regime so that alternatives can be assessed for performance over the same time frame.
In the real world, a time horizon is physically impossible. Even though short term horizons like end of day, end of week, and end of month matter in accounting, these horizons are typically used for simple mark to market processes and summing up.
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Explanation:
A technique to bring changes in the
entire organization, rather man
focusing attention on individuals to
bring changes easily is Organizational development
Answer:
Short range predictors:
c. Nominal interest rate differential
d. Psychological effects
e. Investor expectations
f. Bandwagon effect
Long range predictors:
a. Relative monetary growth
b. Relative inflation rates
Explanation:
Nominal rate, the real rate, and inflation. long term predictors of an economic theory in which a relationship between inflation, nominal interest rate and real interest rate is identified. It defines that real interest rate is equal to inflation minus nominal interest rate.
Bandwagon effect is a short range predictor because it is effect of uptake when people follow others. They take decisions what other do and its their belief that other people have taken the right decision so we too. This is just a short term hop based on beliefs regardless of any underlying evidence.
Answer:
keep producing in the short run but exit the industry or go out of business in the long run
Explanation:
A perfect competition is characterised by many buyers and sellers of homogeneous goods and services. Market prices are set by the forces of demand and supply. There are no barriers to entry or exit of firms into the industry.
In the long run, firms earn zero economic profit. If in the short run firms are earning economic profit, in the long run firms would enter into the industry. This would drive economic profit to zero.
Also, if in the short run, firms are earning economic loss, in the long run, firms would exit the industry until economic profit falls to zero.
A firm should shut down in the short run if price is less than average variable cost. But since the diner's price is greater than average variable cost, it should continue production.
A firm should exit the industry in the long run if price is less than average total cost. the diner's price is less than average total cost, so it should shut down in the long run
Answer:
Swen is using product/service repositioning strategy.
Explanation:
Product Repositioning simply refers to the art of altering the target markets perception of one's product and or services.
Swen is still in the clothing business. He has only changed the way he delivers it to the target consumers.
Of course, this sometimes calls for a change in product mix (which refers to altering the type of products being offered). However, the central idea of the strategy still holds as customers now see the business differently.
This type of strategy is easier to pull off for start-ups, or unpopular businesses trying to make a comeback. Where the business is a well-established brand, it can prove extremely difficult and may be costly.
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