The economic principle of substitution says that when there are two houses in the same neighborhood with the same size, appeal, and utility, the lower-priced one will tend to sell first.
<h3>The economic principle of substitution</h3>
- According to the principle of substitution, the cost of purchasing a substitute that is just as desired tends to establish the upper limit of value, assuming no inopportune delays.
- A shrewd investor would not spend more on an asset that generates income than it would cost to construct or buy an asset of a similar nature.
- According to this theory, the cost of acquiring a comparable substitute property with the same use, design, and revenue determine the maximum value of a property in most cases.
- For instance, why would somebody pay $1,000,000 for a home when they could pay $750,000 for a different but as appealing home in the same neighborhood?
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Answer:
15.4%
Explanation:
Calculation to determine your best guess for the rate of return on the stock
The revised estimate on the rate of return on
the stock would be:
Before
14% = α +[4%*1] + [6%*0.4]
α = 14% - 6.4%
α = 7.6%
With the changes:
7.6% + [5%*1] + [7%*0.4]
= 7.6% + 5% + 2.8%
= 15.4%
Therefore your best guess for the rate of return on the stock will be 15.4%
Answer:
d) credit to Paid-in Capital from Treasury Stock for $30,000
Explanation:
The entry for profit in sale of treasury stock is as computed below
Account Details Debit Credit
Cash (5000*20) $100,000
To treasury stock (5000*14) $70,000
To Additional paid in capital (5000*6) $30,000
Answer:
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▫️Increased productivity. • ...
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▫️Reduced absenteeism. •
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Answer:
net income 4,385
Explanation:
The income statment will only include revenues and expenses account.
A revenue will be the gain realized from the business main activity or secondary like interst or rental revenues.
While expenses will be the cash erogation or losses iincurred in the business activities, their financing like interest expenses and other.
revenues 9,850
expenses <u> 5,465 </u>
net income 4,385
The loan is not an expense. It wil lbe the interest it generated but we aren't given with that information
The dividends also aren't an expense they represent the return to the investors.
