Answer:
the elimination of competition
Explanation:
Answer:
D
Explanation:
Normal goods are goods that are goods whose demand increases when income increases and falls when income falls
If good X is a normal good and the consumers income increases, the demand for good X would increase
It would have been that the Law of demand not supply that didn''t hold
according to the law of supply, the higher the price, the higher the quantity supplied and the lower the price, the lower the quantity supplied.
According to the law of demand, the higher the price, the lower the quantity demanded and the lower the price, the higher the quantity demanded.
Answer: c. increase consumer surplus in the market for tomato sauce and increase producer surplus in the market for spaghetti noodles.
Explanation:
A complementary good is the one which can be used only with another good. For example a CD can only run in a CD player or any other suitable device so the sales of CD is dependent upon the availability of device used to pay it. Other examples are tennis ball and tennis racket, mobile phone and sim cards, and others.
According to the given situation the decrease in price of tomato will be an advantage to the consumers as they will be able to purchase them with an affordable price and can produce tomato sauce this will promote the production of spaghetti noodles as tomato sauce is consumed along with spaghetti noodles this way the tomato sauce and spaghetti noodles are complementary goods for each other. The sales and production of one good will affect the sales and production of another.
Answer:
identify the criteria that are important in making the decision.
Explanation:
Rational decision-making is a step-by-step method for choosing the best choice from the options and is carried out on the basis of reasoning, objectivity and examination of any factor before concluding
Therefore according to the above explanation the correct answer is to identify the criteria that are important in making the decision as it is the first step of rational decision making.
Answer:
The arbitrageur should borrow money at 4% per annum since it is cheaper than paying the forward price for delivery
Explanation:
Current price of gold=$1,400 per ounce
Forward price=$1,500
The arbitrageur can either pay the forward price or borrow $1400 and pay the interest of 4% in a year. Consider option 1 paying the forward price of 1500
Option 1
Since there are no additional costs, the total cost for buying the gold=forward price=$1,500
Option 2
If the arbitrageur borrows the 1400 to pay for the gold now, then pay the interest in 1 year;
The total cost=Amount borrowed+interest accrued in 1 year
Total cost=1400+(4%×1400)
1400+((4/100)×1400)
1400+56=$1456
Since there are no additional costs, option 2=$1456
If we compare option 1 to option 2, we notice that option 2 is slightly cheaper than option 1 by $44
(Option 1-Option 2)=(1500-1456)=$44
The arbitrageur should borrow money at 4% per annum since it is cheaper than paying the forward price for delivery
