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3 years ago

PLEASE HELP ASAP!! CORRECT ANSWER ONLY PLEASE!!!

Business

1 answer:

nataly862011 [7]3 years ago

3 0

Answer:

Explanation:

So, lets go over what inflation and purchasing power mean.

Inflation is the increase in money of something.

Purchasing power is a persons ability of pruchasing something.

Now, heres an example. A 300 dollar apple phone was quickly being purchased, and apple infalted the price to 600 dollars. Since people can only afford to purchase so much, some might not be able to afford this. This means not as many people can purchase it.

Since the price was raised, this measn the inflaction was increased.

Since the amount of people that could afford the apple phone shrunk, the purchasing power decreased.

So basically, to summarize this:

As the infaltion of an item is increased, the purchasing power is decreased, for less people can afford the higher price.

Answer:

<u>D - As the rate of inflation increases, purchasing power decreases.</u>

Hope this helps!

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The common stock of Detroit Engines has a beta of 1.34 and a standard deviation of 11.4 percent. The market rate of return is 11

stealth61 [152]

Answer:

The firm's cost of equity is C. 14.05 percent

Explanation:

Hi, we need to use the following formula in order to find the cost of equity of this firm.

$r(e)=rf+beta(rm-rf)$

Where:

r(e) = Cost of equity

rf = risk free rate

rm = Market rate of return

Everything should look like this.

$r(e)=0.04+1.34(0.115-0.04)=0.1405$

So, this firm´s cost of equity is 14.05%

Best of luck

6 0

3 years ago

In the long run, each firm in a competitive industry earns

madam [21]

Answer:

The correct answer is option B.

Explanation:

In a competitive industry there is no restriction on entry or exit of firms in the market. So, when in the short run the firms are enjoying super normal profits or positive economic profits, this would attract potential firms to join the industry in the long run.

As a result the industry supply will increase in the long run. The increase in supply would cause the price to fall. This would further contribute in reducing revenue and profit.

This process will continue till the profit is reduced to zero. If profit falls below zero, then firms incurring loss will exit the industry. Then again zero profits will be restored by reduction in supply and increase in price.

So, we can say that perfectly competitive firms will have zero economic profits or only normal profits in the long run.

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3 years ago

The gestalt principles of organization ____.

horrorfan [7]

The gestalt principles of organisation state that the human mind has this ability to arrange elements of our experiences in such a way that it forms individual perceptions and views of our environment as based on the frameworks of perception stated.

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3 years ago

Oscar pistorius sport personalites , descrition of the situation he faced that were negetively exploited by the media

Sav [38]

Oscar Pistorius, the sports personality, faced a situation of a murder case that negatively exploited by the media. Oscar Pistorius is a South African sprint runner who competed in Paralympic events. He was convicted as a murderer for the murder case of his girlfriend, Reeva. There were many frenzied media that distract the trial process.

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3 years ago

Refer to the information in Homework 2 Question 2: Ross derives utility from only two goods, chocolates (x) and donuts (y). His

Margaret [11]

Answer:

The total effect is 35 out of which income effect is 15 and substitution effect is 20.

Explanation:

Ross has an income of $1440.

The price of chocolates (Px) is $10 and donuts (Py) is $9.

The utility function is given as

U = 0.5xy

Before price rise, Budget line:

1440 = 10x + 9y,

Consumption is optimal when

$\frac{MUx }{ MUy} = \frac{Px}{Py} = \frac{10}{9} = 1.11$

0.5y / 0.5x= 1.11

y = 1.11x

Substituting in budget line,

1440 = 10x + 9y = 10x + 9(1.11x)

1440 = 10x + 9.99x

19.99x = 1440

x = 72

y = 1.11x = 79.92 = 80

After price rise,

Py = 16.

New budget line:

1440 = 10x + 16y,

Price ratio

$\frac{Px}{Py } = /$

= $\frac{10}{16}$

= 0.625

And,

$\frac{MUx}{Muy} = \frac{0.5y}{0.5x} = 0.625$

$\frac{y}{x} = 0.625$

y = 0.625x

Substituting in new budget line: 1440 = 10x + 16y

1440 = 10x + 16(0.625)x

1440 = 20x

X = 72

Y = 0.625x = 45

So, total effect (TE)

= Decrease in consumption of y

= 80 - 45

= 35

With previous (x, y) bundle,

U = 0.5xy

U = 0.5 x 72 x 80

U = 2880

Keeping utility level the same & substituting,

y = 0.625x in utility function:

28800 = 0.5xy

$2880 = 0.5\ \times\ 0.625x$

$2880 = 0.3125x^{2}$

$x^{2} = \frac{2880}{0.3125}$

$x^{2} = 9216$

$x = \sqrt{9216}$

x = 96

Now, putting the value of x,

y = $0.625\ \times\ x$

y = $0.625\ \times\ 96$

y = 60

Substitution effect (SE)

= 80 - 60

= 20

Income effect

= TE - SE

= 35 - 20

= 15

8 0

3 years ago