a contract in which an owner provides a user the right to use an asset in return for periodic cash payments over a period of time is called a(n) blank . multiple choice question. direct purchase plan lease indenture contingent contract

None of the options would count toward GDP. Here option B is the correct answer.

The Gross Domestic Product (GDP) measures the monetary value of all final goods and services produced within a country's borders in a given period, typically a year. To determine whether an item should be included in GDP, it is important to consider whether it contributes to the production of goods and services and whether it is a final good or service.

Welfare payments, which are transfer payments made by the government to individuals, do not contribute to the production of goods and services and therefore would not be included in GDP. These payments are considered transfers since they do not represent the purchase of goods or services.

On the other hand, the purchase of new military aircraft by the government would be included in GDP since it represents a final good that contributes to the production of national defense. This purchase contributes to the economy's overall production and is therefore considered a part of GDP.

The value of domestic services provided by homemakers in the home, such as cooking, cleaning, and childcare, is not included in GDP. These services are not considered market transactions since there is no exchange of money and therefore are not included in GDP calculations.

To learn more about GDP

https://brainly.com/question/30111703

#SPJ4

Complete question:

Which of the following items would be included in GDP?

A - Welfare payments.

B - None of the choices would be included in GDP.

C - Purchase of new military aircraft by the government.

D - The value of domestic services provided by homemakers in the home.

The required return for the investor would be approximately 5.74%. To answer your question about Colwood Corp's zero coupon bonds, let's break it down into parts:

a. To determine the bonds' selling price at issuance, we need to calculate the present value (PV) of the bond's face value ($1,000) discounted at the required return (8.03%) over the bond's 25-year term. The formula for PV is:

PV = FV / (1 + r)^n

Where:
- FV = Face Value ($1,000)
- r = Required Return (0.0803)
- n = Bond Maturity (25 years)

Plugging in the values, we get:

PV = $1,000 / (1 + 0.0803)^25
PV ≈ $93.22

So, the bonds will sell for approximately $93.22 at issuance.

b. To raise $2,175,000, we need to calculate how many bonds Colwood Corp must issue. Divide the amount they want to raise by the price of each bond:

Number of bonds = Amount to be raised / Bond price
Number of bonds = $2,175,000 / $93.22
Number of bonds ≈ 23,329

Colwood Corp will need to issue approximately 23,329 zero coupon bonds to raise $2,175,000.

c. To find the required return for an investor purchasing a 25-year maturity zero coupon bond with a face value of $1,000 for $250, we can rearrange the PV formula to solve for the required return:

r = (FV / PV)^(1/n) - 1

Where:
- FV = Face Value ($1,000)
- PV = Purchase Price ($250)
- n = Bond Maturity (25 years)

Plugging in the values, we get:

r = ($1,000 / $250)^(1/25) - 1
r ≈ 0.0574 or 5.74%

The required return for the investor would be approximately 5.74%.

To know more about required return refer here:

https://brainly.com/question/31104881#

#SPJ11

The Fed would choose to increase the money supply in order to close a recessionary gap, as this action will help lower interest rates, encourage borrowing, and stimulate economic growth.

To close a recessionary gap, the Federal Reserve (Fed) would select option B, which is to increase the money supply.

A recessionary gap occurs when the economy is producing below its potential output. To close this gap, the Fed aims to stimulate economic growth by increasing the money supply. This is accomplished through various monetary policy tools, such as open market operations, where the Fed can purchase government bonds to inject more money into the economy.

As the money supply increases, interest rates will typically decrease as there is more money available for borrowing. Lower interest rates make it more attractive for businesses and consumers to take out loans and invest in various projects, leading to increased spending and economic growth. This process helps in closing the recessionary gap and moving the economy back toward its potential output.

In summary, the Fed would choose to increase the money supply in order to close a recessionary gap, as this action will help lower interest rates, encourage borrowing, and stimulate economic growth.

For more information on Federal Reserve (Fed) visit:

brainly.com/question/31451910

#SPJ11

Calming Hotels, Inc. has opened two more hotels near the state park. Distributive fairness addresses the socially just distribution of resources. The correct answer is a. Hotel employees are not performing like they should.

Distributive fairness is concerned with results as opposed to just procedure, which is focused on the execution of the law. The social sciences and philosophy have both given this subject a lot of consideration.

Social psychology defines distributive fairness as the perceived equity of how benefits and expenses are divided by Members of the group can feel that distributive fairness has not been upheld if some employees put in greater hours but yet earn the same compensation. People typically check to see if distributive fairness has occurred by observing the behavioural expectations of their group. Distributive justice has taken place if benefits and expenses are distributed in accordance with the established distributive standards of the organisation.

To know more about Distributive fairness visit:

https://brainly.com/question/28386282

#SPJ4

a)  The cash received by the borrower on January 1 of Year 1 is $326,092.47.

b) debt amortization schedule.  1 $340,000.00 $131,930 $27,200.00 $104,730.00 $235,270.00

2 $235,270.00 $131,930 $23,527.00 $108,403.00 $126,867.00

3 $126,867.00 $131,930 $12,686.70 $119,243.30 $7,623.70

a. The cash received by the borrower is calculated as the present value of the note, which is the sum of the present values of the three annual payments:

PV = [tex]131,930 x [(1 - 1/ (1 + 0.10)^3) / 0.10] = $326,092.47[/tex]

Therefore, the cash received by the borrower on January 1 of Year 1 is $326,092.47.

b. The debt amortization schedule is as follows:

Year Beginning Balance Payment Interest Principal Ending Balance

1 $340,000.00 $131,930 $27,200.00 $104,730.00 $235,270.00

2 $235,270.00 $131,930 $23,527.00 $108,403.00 $126,867.00

3 $126,867.00 $131,930 $12,686.70 $119,243.30 $7,623.70

Learn more about debt amortization

https://brainly.com/question/31008029

#SPJ4

When concluding each interview with an expert, it is essential to express your appreciation for their time and valuable insights.

Thank them for sharing their expertise and experiences with you, as this demonstrates respect and gratitude. Additionally, politely ask for permission to contact them later to verify points or clarify any information they have provided during the interview.

This step ensures that you maintain a professional relationship and leaves the door open for future communication, should any questions or concerns arise as you finalize your report. By approaching the conclusion of each interview in this manner, you maintain a positive and respectful rapport with the expert while also ensuring that your report will be as accurate and informative as possible.

For more about interview:

https://brainly.com/question/15128068

#SPJ4

Integrated waste management D. suggests that communities should have multiple options for waste disposal.

Integrated waste management is a comprehensive approach for dealing with all types of garbage, comprised of various approaches intended to reduce, reuse or recycle what can be recycled and properly discard unsalvageable remains.

It acknowledges that the best means of disposing of waste varies via locality, proposing multiple disposal methods - including composting, recycling, waste-to-energy conversion and landfilling - so as to cater to the specific concerns and requirements of each community.

Find out more on integrated waste management at https://brainly.com/question/30437421

#SPJ1

"To maximize profit, a firm will hire workers when the increase in revenue from hiring an additional worker is greater than or equal to the increase in the worker's wage."

This is because firms are profit-maximizing entities, and they will only hire workers when the additional revenue generated from that worker is greater than or equal to the cost of hiring that worker.

A firm aims to maximize its profit by increasing its revenue while minimizing its costs. When the additional revenue generated by hiring a new worker (known as the marginal revenue product) is greater than the cost of paying that worker's wage, it is profitable for the firm to hire the worker.

To know more about Hire workers visit:-

https://brainly.com/question/30029866

#SPJ11

The sequence for the approval of the federal budget is as follows. The President submits a budget proposal to Congress in February of each year. The House and Senate Budget Committees develop a budget resolution outlining spending and revenue priorities.

The House and Senate Appropriations Committees allocate specific amounts of funding to federal agencies and programs. The House and Senate vote on their respective versions of the budget resolution and appropriations bills. If both chambers pass their versions, a conference committee is formed to resolve any differences between the bills.

To know more about federal budget visit:-

https://brainly.com/question/12080214

#SPJ11

When a company sells its receivables to a finance company or bank, the buyer is called a factor.

A factor is a financial intermediary that purchases accounts receivable from a company at a discount, providing immediate cash flow to the seller. The factor then assumes responsibility for collecting payment from the customers who owe money to the seller.

Factors can be an attractive option for companies that need to improve their cash flow. By selling their receivables, they can access funds more quickly than waiting for payment from their customers. This can be especially beneficial for companies that have long payment terms or seasonal sales cycles.

Factors may also provide additional services such as credit checks on potential customers, managing collections, and assuming the risk of non-payment.

However, factors charge a fee for their services, which can range from 1-5% of the receivables' value, depending on various factors such as the creditworthiness of the customers, the volume of receivables being factored, and the length of the payment terms.

In conclusion, selling receivables to a factor can be a useful tool for companies that need to improve their cash flow. However, it is important to weigh the costs and benefits of this option carefully and to choose a factor that provides high-quality services at a reasonable cost.

For more questions on company visit:

https://brainly.com/question/24553900

#SPJ11

The private savings equals $8950.

According to the national savings and investment identity:

National Savings = Private Savings + Public Savings

National Savings = Private Investment + Inflow of Foreign Savings

where Public Savings is equal to the negative of the Government Budget Deficit.

We can use this identity to find the value of Private Savings:

Private Savings = National Savings - Public Savings

Private Savings = Private Investment + Inflow of Foreign Savings - (Government Budget Deficit)

Private Savings = $2750 + $3250 - (-$2950)

Private Savings = $2750 + $3250 + $2950

Private Savings = $8950

Therefore, private savings equals $8950.

Read more on private savings https://brainly.com/question/14521802

#SPJ1

Estimating remaining economic life by projecting a property's historic rate of depreciation into the future is not recommended.

This is because the historic rate of depreciation may not accurately reflect future trends and may be influenced by factors that are no longer relevant, such as changes in economic conditions or improvements in building materials.

Instead, appraisers typically use a combination of methods to estimate the remaining economic life of a property, including a physical inspection of the property, an analysis of its historical and current use, and an evaluation of market trends and conditions. This approach provides a more comprehensive and accurate estimate of the remaining economic life, which is an important factor in determining the overall value of a property.

It is important for appraisers to carefully consider all available data and factors when estimating the remaining economic life of a property and to use sound professional judgment in making their assessments. This can help ensure that the resulting appraisals are accurate, reliable, and useful for making informed decisions about real estate transactions.

To know more about economic life here

https://brainly.com/question/30440816

#SPJ4

The statement "The horizontal analysis of the balance sheet shows the changes in net sales and net income" is true because it shows changes in financial figures.

Horizontal analysis, also known as trend analysis, is a financial statement analysis technique that compares a company's financial performance over time.

Learn more about horizontal analysis here: https://brainly.com/question/25806750

#SPJ11

When a vehicle is purchased, the cost of the vehicle is divided into two parts: the cost of the vehicle and the estimated salvage value. The cost of the vehicle is then spread out over its estimated useful life through a process called depreciation. In this case, the vehicle originally cost $24,840 and had an estimated useful life of 8 years and an estimated salvage value of $2,600.

After 4 years of straight-line depreciation, the asset's total estimated useful life was revised from 8 years to 6 years. This means that the remaining useful life of the vehicle is now only 2 years instead of 4. However, there was no change in the estimated salvage value.
To calculate the depreciation expense in year 5, we need to first calculate the total depreciation expense for the first 4 years. The depreciation expense for each year is calculated by subtracting the salvage value from the cost of the vehicle and then dividing by the estimated useful life. In this case, the total depreciation expense for the first 4 years is:
($24,840 - $2,600) / 8 years * 4 years = $7,310
Now that the estimated useful life has been revised to 6 years, we need to calculate the depreciation expense for years 5 and 6. The depreciation expense for each year is calculated by subtracting the salvage value from the remaining value of the vehicle and then dividing by the remaining useful life. In this case, the remaining value of the vehicle is:
$24,840 - $7,310 = $17,530
The remaining useful life of the vehicle is 2 years, so the depreciation expense for year 5 is:
($17,530 - $2,600) / 2 years = $7,965
Therefore, the answer to the multiple-choice question is $7,965, which is not one of the given options.

For more such question on salvage

https://brainly.com/question/29215874

#SPJ11

The total amount of cash outflow related to the gift to Colin is $5.464 million. This is calculated by adding the gift amount of $5.45 million to the annual exclusion amount of $14,000, which results in a total gift of $5.464 million.

Big Mike has already paid any relevant taxes on the gift to Jordan, so there should be no additional taxes to pay on the gift to Colin. Based on the information provided, Big Mike wants to give his grandson Colin a gift of $5.45 million plus the annual exclusion of $14,000. To determine the total outflow for the gifts and any related taxes, we need to add the gift amount and the annual exclusion.

Step 1: Add the gift amount to the annual exclusion.
$5,450,000 (gift amount) + $14,000 (annual exclusion) = $5,464,000.
The total cash flow related to the gift to Colin is $5.464 million. Your answer: $5.464 million.

To know more about cash outflow visit:

https://brainly.com/question/10714011

#SPJ11

The uncollectible accounts expense that Rue Co. should report for year 2 can be calculated by subtracting the ending allowance balance from the beginning allowance balance and adding any write-offs made during the year. In this case, the beginning allowance balance was $12,000, $48,000 was written off during the year, and the ending allowance balance was $50,000. Therefore, the uncollectible accounts expense for year 2 would be calculated as follows:

Beginning allowance balance: $12,000
Write-offs during the year: $48,000
Ending allowance balance: ($50,000)

Uncollectible accounts expense for year 2: $10,000

So, Rue Co. should report an uncollectible accounts expense of $10,000 for year 2.
To determine the amount of uncollectible accounts expense Rue Co. should report for year 2, follow these steps:

1. Begin with the credit balance of the allowance for uncollectible accounts on December 31, year 1: $12,000.
2. Subtract the number of uncollectible accounts written off during year 2: $12,000 - $48,000 = -$36,000.
3. Determine the required allowance for uncollectible accounts on December 31, year 2, based on the aging of accounts receivable: $50,000.
4. Calculate the difference between the adjusted balance and the required allowance for uncollectible accounts: -$36,000 + $50,000 = $14,000.

Therefore, Rue Co. should report an uncollectible accounts expense of $14,000 for year 2.

To know more about credit balance visit :

https://brainly.com/question/14781034

#SPJ11

Preferred and common stocks are both types of securities that investors can purchase in a company. The main difference between them is that preferred stocks generally have a higher priority in terms of receiving dividends and assets in the event of bankruptcy.

Preferred stocks are usually seen as more stable and less volatile than common stocks, and they typically pay a fixed dividend that is agreed upon at the time of purchase. In addition, preferred stocks often have a call feature, which allows the company to redeem the shares at a set price after a certain amount of time has passed.

On the other hand, common stocks represent ownership in the company and offer the potential for greater returns through capital appreciation. They do not typically pay a fixed dividend and are subject to more fluctuations in value based on market conditions and the company's performance.

In summary, preferred stocks are often viewed as a more conservative investment option, while common stocks offer the potential for higher returns but also carry more risk. It ultimately depends on an investor's goals and risk tolerance when deciding between the two types of stocks.

To know more about common stocks , visit:

https://brainly.com/question/13762106

#SPJ11

Assuming a nonstrategic view of bargaining, you would expect to capture around $140 million of this deal.

This estimate is based on the potential value created by having two distributors in Egypt, which increases the total value from $420 million to $560 million. The incremental value of $140 million is likely to be distributed among the various partners involved in the deal.

However, this estimate might vary depending on negotiation dynamics, distribution costs, and other factors that can influence the final allocation of value among the partners.

Learn more about bargaining here

https://brainly.com/question/31420199

#SPJ12

As a sales manager presenting the sales results of this quarter and the last three quarters to the CEO, the most appropriate chart to use would be a Vertical Bar Chart.

A Vertical Bar Chart, also known as a column chart, would effectively display the sales data for each quarter in a visually clear and easy-to-understand manner. This chart type is best suited for comparing data across categories, which in this case are the different quarters.

To create a Vertical Bar Chart, follow these steps:

1. Label the horizontal axis (x-axis) with the names of each quarter (e.g., Q1, Q2, Q3, Q4).
2. Label the vertical axis (y-axis) with the sales figures, typically using a consistent scale.
3. Draw vertical bars for each quarter, with heights corresponding to their respective sales figures.
4. Assign a unique color or pattern to each bar for better visual distinction and understanding.
5. Optionally, add data labels above each bar to display the exact sales figures.

The other charts mentioned, such as Pie charts and Line charts, are not ideal for this scenario.

A Pie Chart is used to display proportions within a whole, making it difficult to compare data across multiple quarters.

A Line Chart is best suited for displaying continuous data over time, which may not accurately represent the discrete quarterly sales data.

In summary, a Vertical Bar Chart is the most suitable option for presenting sales results of this quarter and the last three quarters to the CEO, as it effectively compares data across the different quarters and allows for easy interpretation of the results.

To know more about Vertical Bar Chart refer here:

https://brainly.com/question/24804422#

#SPJ11

The largest private employer in the United States is Walmart.

The largest private employer in the United States is Walmart. As of 2021, the retail giant employs approximately 1.5 million workers in the US alone, making it not only the largest private employer in the country but also one of the largest employers in the world.

However, it is worth noting that this number includes both full-time and part-time employees. Other major private employers in the US include Amazon, which employs over 800,000 people, and Kroger, which employs over 400,000 people.

To know more about employer visit :-

https://brainly.com/question/1361941

#SPJ11

Activity-based costing information is primarily used to make decisions regarding product costing and cost control. Option C is correct.

This methodology involves identifying the activities that go into producing a product or service and assigning costs to each activity based on its usage. This provides a more accurate picture of the true cost of producing a product, as it takes into account all of the activities that contribute to its production.

With this information, businesses can make more informed decisions about how to allocate resources and control costs. They can identify which activities are adding the most value to the product and which are not, and make adjustments accordingly. This can help to increase efficiency, reduce waste, and ultimately improve profitability.

While activity-based costing information can be useful in other areas such as distribution channel profitability and pricing and customer profitability, its primary use is in product costing and cost control. By using this methodology, businesses can gain a more accurate understanding of their costs and make better decisions about how to allocate their resources.

To learn more about activity-based costing, visit: https://brainly.com/question/30395542

#SPJ11

An outright sale of a ventur whether it be a profit, relative value method cash flow, or other indicator, with the observed market value. In fact, it is thought to be the primary driver of this market value.

Based on a company's enterprise value, several frequently used multiples are available. These multiples are particularly significant in mergers, acquisitions.

And deals involving privately held businesses because they reflect a company's rating independent of its capital structure. Not all multiples are determined by factors affecting earnings or cash flow. A frequently used metric for comparing the market value and book value of a company's assets is the price-to-book (P/B) ratio. Measures of relative value to sales include the price-to-sales ratio and the EV-to-sales ratio. Because both sales and book value are less important value drivers, these multiples should be used with caution.

To know more about Relatives value method visit:

https://brainly.com/question/30025428

#SPJ4

The harmonization of standards can have both positive and negative effects on different countries depending on their level of development and economic status.

Harmonization of standards refers to the process of aligning regulations and guidelines across different countries or regions. This can be beneficial in promoting international trade and reducing barriers to entry for businesses operating in multiple markets. However, it can also have negative consequences, particularly for countries with lower levels of economic development.

For dissimilar countries, harmonization of standards may be easier as there may be less variation in their existing regulations and guidelines. This can facilitate the process of aligning their standards, making it less difficult.

1. Harmonization of standards refers to the process of creating a single set of rules, regulations, or guidelines to be followed by different countries or organizations. This simplifies international trade and cooperation.

2. When dissimilar countries harmonize their standards, it is less difficult because they can agree on a common set of rules that cater to the needs of both nations, ultimately benefiting their economies.

3. Harmonization can be part of the "race to the bottom," which refers to a situation where countries lower their standards or regulations in order to attract business and investments. However, this can also lead to negative consequences such as reduced quality or worker exploitation.

4. While harmonization may be costly for high-income countries, as they might need to lower their standards to accommodate lower-income countries, it can ultimately lead to reduced costs for firms. This is because firms can save on expenses related to complying with different sets of rules and regulations in different countries, as well as increased efficiency and simplified procedures.

To Know more about organizations.

https://brainly.com/question/12825206

#SPJ11

The following principles of internal control are commonly recognized:

Perform regular and independent reviews, Separate recordkeeping from the custody of assets, Apply technological controls, Maintain adequate records, and Establish responsibilities. Options 1, 5, 6, 7, and 8 are correct.

Internal control principle:

It is a framework of controls designed to minimize risks and provide reasonable assurance that the organization's objectives will be achieved.

These principles are commonly found in internal control frameworks such as the COSO (Committee of Sponsoring Organizations of the Treadway Commission) framework.

Other principles, such as matching revenues with expenses in the same accounting period and recording assets at cost, are related to accounting principles but may not be specifically classified as principles of internal control. Insuring assets can be a risk management strategy rather than an internal control principle.

Therefore, the correct options are 1, 5, 6, 7, and 8.

To learn more about the Internal control principle, click here:

https://brainly.com/question/29870556

#SPJ12

Describe the internal control principle of dividing responsibility for related transactions. (Check all that apply.)

Walmart serves approximately 265 million customers globally in one week.

Walmart is one of the largest retailers in the world with a massive global presence. According to Walmart's 2021 annual report, the company operates over 10,500 stores in 24 countries, serving millions of customers each day.

Based on the same report, Walmart reported serving approximately 265 million customers globally in one week. This means that across its numerous locations, Walmart serves a staggering number of customers each week. This number highlights the significant scale and impact of Walmart's business operations, making it one of the largest retail companies in the world.

To know more about customers  visit :-

https://brainly.com/question/29999842

#SPJ11

The role of Control is responsible for managing the Stock In Transit reconciliation , to ensure the other responsible groups are maintaining their reconciliation tasks to ensure the Stock In Transit is resolved in a timely manner .Control plays a crucial role in ensuring that the Stock In Transit is resolved in a timely manner by managing the overall reconciliation process.

To elaborate, Control is responsible for overseeing the reconciliation of Stock In Transit across all departments and ensuring that each responsible group is completing their assigned tasks. This includes monitoring the progress of reconciliation, identifying discrepancies, and taking corrective actions as necessary.
By effectively managing the Stock In Transit reconciliation process, Control can ensure that all outstanding Stock In Transit is accounted for and resolved in a timely manner. This can help prevent stock losses, improve inventory accuracy, and reduce the risk of financial losses due to unaccounted-for inventory.
Overall, the role of Control in managing the Stock In Transit reconciliation process is critical to the success of inventory management in an organization. By ensuring that all stakeholders are held accountable for their responsibilities, Control can help maintain the integrity of the inventory and ensure that the organization is operating efficiently and effectively.

For more such questions on Stock

https://brainly.com/question/26128641

#SPJ11

As an alternative to selling bonds as a means of raising funds, a large company could explore various other options. One such option could be to issue shares of its stock to the public, which would provide the company with an infusion of cash in exchange for ownership in the company. Another option could be to take out a loan from a bank or other financial institution, although this would come with interest payments and potentially restrictive covenants.

Additionally, a company could consider selling assets or restructuring its operations to free up capital. Ultimately, the choice of funding method will depend on a company's specific financial situation and strategic goals. It is important for companies to carefully evaluate all of their options before deciding on the best course of action to raise funds.

As an alternative to selling bonds as a means of raising funds, a large company could, instead, issue stocks or engage in equity financing. This involves offering ownership shares to investors, which allows the company to raise capital without incurring debt. By issuing stocks, the company can benefit from the influx of funds to support business expansion, research and development, or other operational expenses. However, this method may dilute existing shareholders' ownership and require sharing profits through dividends.

To know more about alternative visit:-

https://brainly.com/question/29454589

#SPJ11

The current ratio will always be equal to or larger than the acid-test ratio for a specific company. Option A is correct

This is because the current ratio includes all current assets in the calculation (including inventory and prepaid expenses), while the acid-test ratio only includes the most liquid current assets (cash, marketable securities, and accounts receivable). Therefore, the current ratio provides a broader view of a company's liquidity position, while the acid-test ratio provides a more conservative measure.

The current ratio measures a company's ability to pay off its current liabilities using its current assets. It's calculated by dividing current assets by current liabilities. A current ratio of 1 or higher indicates that a company has enough current assets to cover its current liabilities, while a ratio below 1 indicates that a company may have difficulty meeting its short-term obligations.

To learn more about current ratio, visit here

https://brainly.com/question/28214599

#SPJ4

True. An extranet is a private network that allows authorized users to access specific resources or services from outside the organization.

It is usually set up for business partners, suppliers, or customers to access certain information or systems. However, access is still restricted and only available to those who have been granted permission by the organization.

Learn more about the extranet:

brainly.com/question/13263185

#SPJ11

False. The statement is generally not true. When a good or service is a small part of a person's budget, it is more likely to be considered a luxury or discretionary item, and therefore more likely to be elastic.

On the other hand, when a good or service is a large part of a person's budget, it is more likely to be considered a necessity or essential item, and therefore more likely to be inelastic.

For example, if a person's income is $1,000 per month and they spend $10 on coffee, it may be easy for them to cut back on coffee purchases without much impact on their overall budget. However, if they spend $500 on rent, it would be much more difficult for them to reduce their rent expenses. Therefore, coffee would be more elastic and rent would be more inelastic.

To learn more about  budget.  here

https://brainly.com/question/24940564

#SPJ4