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3 years ago

A group of sellers who agree to restrict their collective output in order to drive up prices above marginal costs is a:

1 answer:

3 0

A group of sellers who agree to restrict their collective output in order to drive up prices above marginal costs is known as a:

<u>Cartel</u>

According to the given question, we are asked to show the term which can be best used to <em>describe </em>a group of sellers who make an agreement to <em>reduce their collective output</em> so that price of goods would increase above their marginal costs.

As a result of this, we can see that this group of people in the business world are known as cartel because they behave unethically so that they could have increased profit on sales.

You might be interested in

Find the average rate of change of the tuition and fees at public two-year colleges. the average rate of change is $ nothing per

Westkost [7]

The average change in the tuition in the school is $1748.30 per year

<h3>How to find the average rate of change</h3>

The formula would be

y2 -y1 / x2 - x1

The value for y1 = 19890

y2 = 30380

x2 = 2011

x1 = 2005

We would have to put these values in the formula that we have above such that we would be having:

30380 - 19890 / 2011 - 2005

10490 / 6

= $1748.30

Hence we would say that the average rate of change is $1748.30 per year.

Read more on the average rate of change here

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5 0

2 years ago

Edwards Construction currently has debt outstanding with a market value of $101,000 and a cost of 10 percent. The company has EB

Mashcka [7]

Answer:

(a) (i) 0

(ii) 1

(b) $27,775; 0.784

Explanation:

a-1)

Interest paid = market value of debt × cost

= $101,000 × 0.1

= $10,100

EBIT = $10,100

Cash flow to shareholders = EBIT - Interest paid

= $10,100 - $10,100

= 0

value of equity = 0

a-2)

Debt to value = total debt ÷ total value of firm

total debt value debt is $101,000

No default is likely to occur

Hence , total value of firm = total debt

= $101,000

Hence, the debt to value ratio is 1 .

(b) At growth rate 2%

EBIT next year will be:

= $10,100 × (1.02)

= $10,302

Since there is no risk, the required return for shareholders is the same as the required return on the company’s debt.

The payments made to the shareholders increase at 2% every year.

Present value of these payments :

Value of equity = [ $10,302 ÷ (0.1 - 0.02)] - [$10,100 ÷ 0.1]

= $128,775 - $101,000

= $27,775

Debt to value ratio = $101,000 ÷ ($101,000 + $27,775)

= 0.784

EBIT next year will be:

= $10,100 × (1.06)

= $10,706

Present value of these payments :

Value of equity = [ $10,706 ÷ (0.1 - 0.06)] - [$10,100 ÷ 0.1]

= $267,650 - $101,000

= $166,650

Debt to value ratio = $101,000 ÷ ($101,000 + $166,650)

= 0.377

7 0

3 years ago

A cell phone company introduced its brand-new 5G phone into the market. The phone featured global network capability, the fastes

vodka [1.7K]

Answer:

demand will be low

Explanation:

According to my research on different pricing strategies, I can say that based on the information provided within the question demand will be low. Since they will be charging high amounts the demand will be lower because only a select few amount of people will be able to afford it. Usually their consumer base will be made up of enthusiasts and loyal customers that have supported the brand for years and have a good economic standing. Demand will slowly rise as competition sets in and prices decrease.

I hope this answered your question. If you have any more questions feel free to ask away at Brainly.

6 0

4 years ago

If the government is required to balance the budget and the economy falls into a recession, which of the actions is a feasible p

nika2105 [10]

Answer:

The correct answer is: cut spending equal to the reduction in tax revenue.

The correct answer is: The negative consequences of the recession are magnified.

Explanation:

Recession is likely to cause a reduction in the aggregate demand, consumer income, and spending will decrease as well. As a result, the tax revenue to the government will fall as well.

A balanced budget means that government expenditures should be equal to revenue. So if the government wants to have a balanced budget it needs to reduce its spending by the same amount as the reduction in the tax earnings.

This will lead to a reduction in the aggregate demand further magnifying the effects of the recession.

7 0

3 years ago

Read 2 more answers

The is the interest rate that a firm pays on any new debt financing. Andalusian Limited (AL) can borrow funds at an interest rat

valina [46]

Answer:

5.34%

The correct option is C,5.60%

Explanation:

The are two requirements here,the first is after cost of debt for the first part of the case study and after tax cost of debt for the second part of the scenario:

1.after tax cost of debt=pretax cost of debt*(1-t)

pretax cost of debt is 9.7%

t is the tax rate at 45% or 0.45

after tax cost of debt=9.7%*(1-0.45)=5.34%

The pretax cost of debt here is computed using the rate formula in excel:

=rate(nper,pmt,-pv,fv)

nper is the number of times the bond pays coupon interest which is 15

pmt is the annual coupon interest receivable by investors i.e $1000*12%=$120

pv is the current market price of the bond which is $1,136.50

fv is the face value of the bond at $1000

=rate(15,120,-1136.50,1000)

rate =10.19%

after tax cost of debt=10.19% *(1-0.45)=5.60%

7 0

3 years ago