The statement According to Bob French, stock prices move because of disagreements about the facts of a company (e.g. its financial ratios) among investors is true.
Regarding the second statement, "Assume you purchase a Treasury Inflation-Protected Security (TIPS) with a face value of $100 and an interest rate of 4%. If inflation increases by 7%, the face value of the TIPS increases to $104," it is false.
Treasury Inflation-Protected Securities (TIPS) are designed to adjust their principal value based on changes in inflation. If inflation increases, the principal value of TIPS would indeed increase, but it would be adjusted proportionally to the inflation rate, not by the exact amount of inflation.
In this case, if inflation increases by 7%, the face value of the TIPS would increase by 4% (the fixed interest rate) multiplied by 7%, resulting in a new face value of $104.28, not $104.
Therefore, the statement is false.
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According to Bob French, stock prices move because of disagreements about the facts of a company (e.g. its financial ratios) among investors.
True
False
Assume you purchase a Treasury Inflation-Protected Security (TIPS) with a face value of $100 & interest rate of 4%. If inflation increases by 7%, the face value of the TIPS increases to $104.
True
False
On June 30 , Year 3 , Benson Company's total current assets were $500,000 and its total current liabilities were $275.000. On July 1 , Year 3 , Benson issued a fong-term note to a bank for $41,600cosh. Required a. Compute Benson's working capital before and after issuing the note. b. Compute Benson's current ratio before and after issuing the note. (Round your answers to 1 decimal place.)
a. Computation of Benson's working capital before and after issuing the note
Working capital is defined as current assets minus current liabilities. Therefore, the working capital before issuing the note is:
Working capital before = Total current assets - Total current liabilities
Working capital before = $500,000 - $275,000
= $225,000
After issuing the note, Benson's cash increases, and so does its current liabilities. Thus, the working capital becomes:
Working capital after = Total current assets - Total current liabilities
Working capital after = $500,000 + $41,600 - $275,000
Working capital after = $266,600
Therefore, Benson's working capital before issuing the note was $225,000, and after issuing the note, it became $266,600
b. Computation of Benson's current ratio before and after issuing the note The current ratio is calculated by dividing total current assets by total current liabilities. Therefore, the current ratio before issuing the note is:
Current ratio before = Total current assets / Total current liabilities
Current ratio before = $500,000 / $275,000
Current ratio before = 1.82:1
After issuing the note, the total current assets and current liabilities change. Therefore, the current ratio becomes:
Current ratio after = Total current assets / Total current liabilities
Current ratio after = ($500,000 + $41,600) / ($275,000 + $41,600)
Current ratio after = $541,600 / $316,600
Current ratio after = 1.71:1
Therefore, Benson's current ratio before issuing the note was 1.82:1, and after issuing the note, it became 1.71:1.
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Question 2
a. Discuss the factors that explain the difference in living standards between the European Union and the USA (50 points) b. From your above analysis, discuss the policies that the EU would require to catch up with the USA (50 points)
Factors that explain the difference in living standards between the European Union and the USA are as follows:1. Differences in labor markets: The European Union (EU) places more emphasis on social welfare and policies that improve working conditions.
In comparison, the US has a more open market economy that values competition and entrepreneurship.2. Differences in education: The US has a better-developed education system that supports innovation and research, which attracts more talented individuals. Differences in infrastructure: The US has better infrastructure, including highways, ports, and airports, which facilitates trade and economic growth.4. Differences in taxation: The US has a more favorable tax environment, which attracts foreign investors and encourages entrepreneurship.
The EU, on the other hand, imposes high taxes to fund social welfare programs.5. Differences in regulation: The US has less stringent regulations than the EU, which encourages entrepreneurship and innovation. In contrast, the EU prioritizes consumer protection and environmental regulations, which may create barriers to entry for firms.b) To catch up with the USA, the EU would need to implement the following policies:1. Increase investment in research and development: The EU should invest more in education and research to promote innovation and attract more talented individuals.2. Reduce regulations: The EU should eliminate unnecessary regulations and reduce bureaucratic red tape to encourage entrepreneurship and innovation.3.
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Public Expenditure in social sectors such as Health and Education has been argued to produce positive externality, and this has been used as a justification by Governments world over to provide subsidies. To promote coverage and improve outcomes, the New Dawn Government elected after the 12th of August 2021 in Zambia declared free education up to secondary education. Many commentators have also argued that the Zambian Government should also provide subsidies to tertiary education for not only public universities but also private universities.
Explain the argument supporting this education subsidy and use the graph to explain how the subsidy can be used to internalize this externality. [10 Marks]
Is there any circumstance which favors subsidy rather than public provision as an instrument to improve social efficiency? Kindly explain. [10 Marks]
After examining the arguments on both sides, which side is more plausible to you? Should education be subsidized or publicly provided by Government? [5 Marks]
Education is a good with positive externalities, meaning that the benefits of education extend beyond the individual student to society as a whole. This is because educated people are more likely to be productive workers, taxpayers, and citizens.
The graph below shows the market for education in the absence of a subsidy. The demand curve (D) shows the private benefits of education to students, while the supply curve (S) shows the cost of education to providers. The equilibrium quantity of education is Q1, and the equilibrium price is P1.
The government can provide a subsidy to education by paying part of the cost of tuition. This shifts the supply curve down to S', and the new equilibrium quantity of education is Q2. The price of education falls to P2.
The subsidy has two effects. First, it makes education more affordable for students, which increases the quantity demanded. Second, it lowers the cost of education for providers, which increases the quantity supplied.
The subsidy internalizes the positive externalities of education by making the market price reflect the full social benefits of education. This leads to a more efficient allocation of resources, as more people are able to get an education and society as a whole benefits.
Circumstances favoring subsidy over public provision
There are a few circumstances in which a subsidy may be preferable to public provision of education. First, if the government is not able to effectively manage the provision of education, a subsidy may be a better way to ensure that students have access to quality education.
Second, if there are a variety of different types of education that students can choose from, a subsidy may allow students to more easily choose the type of education that is best for them. Third, if the government is concerned about the cost of public provision of education, a subsidy may be a more cost-effective way to achieve the same social benefits.
The arguments in favor of subsidizing education are strong. Education has positive externalities, and a subsidy can be used to internalize these externalities and encourage more people to get an education.
In some cases, a subsidy may be preferable to public provision of education. Ultimately, the decision of whether to subsidize or publicly provide education is a complex one that depends on the specific circumstances of each country.
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what is meant by capital deepening? question 10 options: a) when an economy increases the average level of physical and/or human capital per person. b) the process of a firm turning economic inputs like labor, machinery, and raw materials into outputs like goods and services used by consumers. c) the skills and education of workers. d) the process of an economy as a whole turning economic inputs like labor, machinery, and raw materials into outputs like goods and services used by consumers.
Capital deepening refers to the process of increasing the average level of physical and/or human capital per person in an economy. This means that the economy is focusing on enhancing the quantity or quality of its capital resources available for production.
In the context of economic development, capital deepening involves allocating resources towards investments in physical capital, such as machinery, equipment, infrastructure, and technology, as well as investments in human capital, which includes education, training, and skill development. By increasing the amount or improving the quality of capital per worker, capital deepening aims to enhance productivity and output levels in the economy.
When an economy engages in capital deepening, it enables workers to produce more goods and services per unit of input, leading to economic growth and improved living standards. By expanding the stock of capital, both physical and human, a country can experience increased efficiency, technological advancements, and higher levels of output. This process is crucial for long-term economic development as it contributes to sustained growth and improves the overall productive capacity of the economy.
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Arlene Henry does not believe that the IFE holds. Current one-year interest rates in Germany are 7 percent, whereas one-year interest rates in the U.S. are 5 percent. Arlene converts $2,000,000 to Euro and invests them in Germany. One year later, she converts the Euro back to USD. The current spot rate of the Euro is $1.10.
Arlene Henry disproves the Interest Rate Parity by converting $2,000,000 to Euros, investing in Germany, and earning a $140,700 profit due to the interest rate differential.
Arlene Henry takes a position against the Interest Rate Parity (IRP) and aims to profit from the interest rate differential between Germany and the U.S. She converts $2,000,000 to Euros at the spot rate of $1.10/Euro, resulting in €1,818,181.82. Arlene then invests this amount in Germany, where the one-year interest rate is 7 percent. After one year, her investment would grow to €1,946,090.91. Converting this back to USD at the spot rate of $1.10/Euro, Arlene would receive $2,140,700. Consequently, she gains $140,700, which equals the difference in interest rates (7% - 5%) multiplied by the initial investment amount.
Arlene's successful investment outcome contradicts the IRP, suggesting that it does not hold in this particular scenario. This result supports her belief that exploiting interest rate differentials can lead to profitable opportunities in the foreign exchange market. However, it is important to note that the IRP generally holds in efficient markets over the long term, and deviations are often short-lived due to arbitrage activities.
Therefore, Arlene Henry disproves the Interest Rate Parity by converting $2,000,000 to Euros, investing in Germany, and earning a $140,700 profit due to the interest rate differential.
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Consider an economy with the Cobb-Douglas production function: Y = 3KºN¹-a Let a = 0.35. (a) Derive the equation describing labor demand in this economy as a function of the real wage and the capital stock. (b) Let K = 100. The economy has 1500 workers. Assuming that factor prices adjust to equilibrium supply and demand, calculate the real wage, total output, and the total amount earned by workers. (c) Now, suppose that Congress, concerned about the welfare of the working class, passes a law setting the minimum wage that is 10 percent above the equilibrium wage you just derived. Assuming that Congress cannot dictate how many workers 3 are hired at the mandated wage, what are the effects of this law? Specifically, calculate what happens to the real wage, the employment, the output, and the total amount earned by workers. (d) Does Congress succeed in its goal of helping the working class? Explain. (e) Do you think the analysis provides a good way of thinking about a minimum-wage low? Why or why not?
(a) Derive the equation describing labor demand in this economy as a function of the real wage and the capital stock.Labor demand function is obtained by minimizing the costs of production with respect to the use of labor holding output constant.
Mathematically, labor demand function can be expressed as,ML = [(1-a)/w]KThe above equation gives the demand of labor which is a function of capital stock K and the real wage rate w.(b) Let K = 100. The economy has 1500 workers. Assuming that factor prices adjust to equilibrium supply and demand, calculate the real wage, total output, and the = 1.1 × w = 1.1 × 1.10 ≈ $1.21Real wage will increase to $1.21, which is 10% above the initial wage. However, the labor demand Also, the increase in wages increases the cost of production, and hence the price of output. This leads to a decrease in output, employment, and total amount earned by workers.
Does Congress succeed in its goal of helping the working class? Explain.Congress does not succeed in its goal of remain employed earn higher wages, but some workers will lose their jobs.(e) Do you think the analysis provides a good way of thinking about a minimum-wage low? Why or why not?Yes, the analysis provides a good way of thinking about a minimum-wage law. It gives a clear understanding of how the labor market works and what would happen when the minimum wage is imposed above the equilibrium wage. This helps in making informed decisions on how to set the minimum wage that will be beneficial to both the workers and the firms.
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Describe On-Line Sentiment by doing the following:
Define On-Line Sentiment
Describe how it impacts marketers
Give an example of words, terms, or a situation where it has an impact and explain why
On-Line Sentiment refers to the overall attitude or emotions expressed by individuals towards a particular brand, product, service, or topic on the internet. It can be positive, negative, or neutral.
On-Line Sentiment impacts marketers in several ways. Firstly, it helps them understand the perception of their brand among consumers. Positive sentiment can boost brand reputation and loyalty, while negative sentiment can harm the brand image and lead to a decrease in sales. Marketers can also use sentiment analysis to identify potential issues or concerns raised by customers and take proactive measures to address them. Additionally, analyzing on-line sentiment allows marketers to monitor the effectiveness of their marketing campaigns and adjust their strategies accordingly.
An example of a situation where on-line sentiment has an impact is when a company launches a new product. Let's say a tech company releases a highly anticipated smartphone. By monitoring on-line sentiment, marketers can gauge how customers perceive the new product. If the sentiment is overwhelmingly positive, it can generate buzz, attract more customers, and increase sales. On the other hand, if the sentiment is negative, marketers can identify the reasons for dissatisfaction and make improvements or address concerns to mitigate the negative impact on sales.
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when you were born, your aunt opened an investment account in your name and deposited $100 into the account. you are now 20 years old. today, the account is valued at $704.00. assuming quarterly compounding, what is the average annual rate of return on the account?
The average annual rate of return on the investment account, assuming quarterly compounding, is approximately 32.864%.
To calculate the average annual rate of return on the investment account, we can use the compound interest formula.
The formula for compound interest is A = P(1 + r/n) (nt), where A is the final amount, P is the initial principal, r is the annual interest rate, n is the number of times interest is compounded per year, and t is the number of years.
Given that the account is now valued at $704.00 and the initial deposit was $100.00, we can calculate the value of (1 + r/n) (nt) as 7.04.
Since the interest is compounded quarterly, n would be 4.
Substituting the values into the formula, we have
7.04 = 100(1 + r/4) (4*20).
Simplifying further, 7.04 = (1 + r/4) 80.
To solve for r, we take the 80th root of both sides: (1 + r/4) = 7.04 (1/80).
Simplifying, 1 + r/4 = 1.08216.
Subtracting 1 from both sides, we get r/4 = 0.08216.
Multiplying both sides by 4, we find that the annual interest rate r is approximately 0.32864 or 32.864%.
Therefore, the average annual rate of return on the investment account is approximately 32.864%.
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ABC Inc received a bill for $12600 dated June 8 with payment terms of 3/15, n/45. What payment on June 22 would reduce the amount owing to 3800? Entert your answer in dollars but do not include the $ sign
ABC Inc received a bill for $12600 dated June 8 with payment terms of 3/15, n/45. What payment on June 22 would reduce the amount owing to 3800?The payment terms 3/15, n/45 refer to the credit terms provided to the buyer by the seller, where 3 stands for the discount percentage that the buyer can avail, 15 stands for the number of days within which the buyer should make the payment to avail the discount and n stands for the net period (i.e., within which the buyer must make the payment).
The value of n in this scenario is 45 days.Now, if the payment is made on June 22, then the number of days between June 8 and June 22 is 14 days (i.e., June 22 - June 8). As per the payment terms, the buyer has 15 days to make the payment to avail the discount.Therefore, if the payment is made on June 22, the buyer will not be eligible for the discount amount. Hence, the total payment amount would be calculated as follows:Total payment amount = $12600 - $3800 = $880The payment terms 3/15, n/45 mean that the buyer can avail a 3% discount if the payment is made within 15 days.
Otherwise, the net payment is due within 45 days.Since the bill was received on June 8 and the payment terms provide for a discount of 3% if payment is made within 15 days, the discount period would be 15 days from June 8, which would end on June 22. Hence, if the payment is made on or before June 22, the buyer can avail the 3% discount, which is given as follows:Discount = 3% of $12600= (3/100) × $12600= $378Therefore, the amount payable by If the payment is made on June 22, the buyer still has 31 days (from June 22 to July 23) within which to make the net payment. Since the amount owing after discount is $12222 and the buyer is required to make a payment of $3800 on June 22, the remaining amount payable would be as follows:Remaining amount payable = $12222 - $3800= $8422Therefore, the payment of $3800 on June 22 would reduce the amount owing to $8422.
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One of the measures on the country's risk level is using the Business Environment Risk Intelligence (BERI)'s suggested POR (Profit Opportunity Recommendation) combined score, which tells the country risk level. Based on the BERI's country risk definition, which of the following countries has the lowest risk (or highest profit opportunity)? 1) Austria, POR Combined Score: 70 2) Mexico, POR Combined Score: 65 3) Italy, POR Combined Score: 49 4) United States, POR Combined Score: 60
Based on the information provided, the country with the lowest risk or highest profit opportunity, according to BERI's POR Combined Score, is Italy with a score of 49. So, correct option is 3.
The POR Combined Score is a measure used by Business Environment Risk Intelligence (BERI) to assess the profit opportunity and risk level of countries. A lower score indicates a lower risk level and potentially higher profit opportunities.
In this case, Austria has a POR Combined Score of 70, Mexico has a score of 65, Italy has a score of 49, and the United States has a score of 60. Among these options, Italy has the lowest score, suggesting that it has the lowest risk level or the highest profit opportunity according to BERI's assessment.
The POR Combined Score is just one measure of risk and profit opportunity, and other factors such as economic conditions, political stability, and market dynamics should also be considered when assessing investment opportunities in different countries.
So, correct option is 3.
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For the production function Q = 4LK, returns to scale: Select one: O Is decreasing. O Is constant. O is increasing. O Can be increasing, decreasing, or constant depending on the values of L and K.
The production function exhibits constant returns to scale, where increasing both labor and capital inputs proportionally results in an equal proportional increase in output. Option C.
The production function Q = 4LK represents a Cobb-Douglas production function, where Q represents output, L represents labor input, and K represents capital input. Returns to scale refer to the relationship between increasing the inputs proportionally and the resulting change in output.
In this case, the production function exhibits constant returns to scale. Constant returns to scale occur when increasing both labor (L) and capital (K) inputs by a certain proportion leads to an equal proportional increase in output (Q). In other words, if both labor and capital are doubled, the output will also double.
This implies that the scale of production does not affect the efficiency or productivity of the inputs.
Mathematically, to determine returns to scale, we can examine the exponents of L and K in the production function. Since the exponents are both 1 (Q = 4L^1K^1), the sum of the exponents is equal to 1+1 = 2, indicating constant returns to scale. So OptioN C is correct.
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Company XYZ had the following transactions during the year:
1. Increase in accounts receivable
2. Purchased equipment
3. Sold land
4. Depreciation of truck
5. Increase in accounts payable
6. Decrease in notes payable
7. Issuance of common stock
8. Gain on sale of land
Classify each transaction as (1) operating, investing, or financing, and (2) increase or decrease in
cash. You can also classify a transaction as a noncash activity.
1. Operating activity, decrease in cash; 2. Investing activity, decrease in cash; 3. Investing activity, increase in cash; 4. Operating activity, noncash activity; 5. Operating activity, no effect on cash
6. Financing activity, no effect on cash (decrease in liabilities).
7. Financing activity, increase in cash.
8. Operating activity, noncash activity (no effect on cash).
1. Increase in accounts receivable: This is an operating activity as it relates to the company's sales on credit. It results in a decrease in cash because the company has not yet received the cash from the customers for the sales made on credit.
2. Purchased equipment: This is an investing activity as it involves the acquisition of long-term assets. It results in a decrease in cash because the company pays cash to acquire the equipment.
3. Sold land: This is an investing activity as it involves the sale of a long-term asset. It results in an increase in cash because the company receives cash from the buyer in exchange for the land.
4. Depreciation of truck: This is an operating activity but does not affect cash. Depreciation is a noncash expense that represents the allocation of the cost of the truck over its useful life.
5. Increase in accounts payable: This is an operating activity as it relates to the company's purchases on credit. It does not have an immediate effect on cash but increases the company's liabilities.
6. Decrease in notes payable: This is a financing activity as it involves the reduction of a liability. It does not have an immediate effect on cash but decreases the company's liabilities.
7. Issuance of common stock: This is a financing activity as it involves the sale of equity shares. It results in an increase in cash because the company receives cash from investors in exchange for the newly issued shares.
8. Gain on sale of land: This is an operating activity but does not affect cash. It represents a noncash gain resulting from the sale of land, which does not involve an exchange of cash.
In summary, the transactions can be classified as follows:
- Operating activities with a decrease in cash: 1
- Investing activities with a decrease in cash: 2
- Investing activities with an increase in cash: 3
- Operating activities (noncash): 4, 8
- Operating activities with no effect on cash: 5
- Financing activities with no effect on cash: 6
- Financing activities with an increase in cash: 7
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A nation's frictional unemployment rate is 1 percent. Seasonal unemployment does not exist in this coun- try. Its cyclical rate of unemployment is 3 percent, and its structural unemployment rate is 4 percent. What is this nation's overall rate of unemployment? What is its natural rate of unemployment?
The country's overall rate of unemployment and natural rate of unemployment, given its cyclical, structural and frictional unemployment rates, will be calculated.
Calculation of overall rate of unemployment: It can be calculated using the formula: Overall Rate of Unemployment = Cyclical Unemployment + Structural Unemployment + Frictional Unemployment. Using the values from the given problem, we can substitute the values: Overall Rate of Unemployment = 3% + 4% + 1% = 8%. Therefore, the country's overall rate of unemployment is 8%.
Calculation of natural rate of unemployment: It is a measure of unemployment that does not occur due to cyclical factors and is often called the equilibrium rate of unemployment. Natural Rate of Unemployment = Structural Unemployment + Frictional Unemployment. Using the values from the given problem, we can substitute the values: Natural Rate of Unemployment = 4% + 1% = 5%Therefore, the country's natural rate of unemployment is 5%.
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East Meets West Ltd. is a Canadian company with a fully owned subsidary in the UK . The UK subsidary produces a component for off shore gas compressors that are sold in canada. The component have variable cost of 1,700 Euro and a full cost of 2,100 Euros. The 2,000 components required can be purchased in Canada for $3,500. Assume the minimum transfer transfer allowed by Canadian tax authorities is the variable cost and the maximum is the market value. Also assume operating income in each country is equal to taxable income. One Euro is worth $1.45 canadian . The marginal tax rate in Canada is 25% and in Ireland 12.5%.
Require
a) What transfer price should be set for East Meets Ltd. to minimize its total income taxes? show your calculations.
b) if East Meets West Ltd. desires to minimize its total income taxes, calculate the amount of tax liability in each country in canadian dolla
a) The transfer price that should be set for East Meets West Ltd. to minimize its total income taxes is the variable cost of the component, which is 1,700 Euros.
b) To calculate the tax liability in each country in Canadian dollars, we need to determine the taxable income and apply the respective tax rates. The taxable income in Canada can be calculated as the number of components (2,000) multiplied by the transfer price in Canadian dollars ($1.45) minus the cost of purchasing the components in Canada ($3,500). The taxable income in Ireland is the number of components (2,000) multiplied by the transfer price in Canadian dollars ($1.45). The tax liability in each country can then be calculated by multiplying the taxable income by the respective tax rates.
a) The transfer price that minimizes total income taxes for East Meets West Ltd. is the variable cost of the component, which is 1,700 Euros. This is because the minimum transfer price allowed by Canadian tax authorities is the variable cost. By setting the transfer price equal to the variable cost, the taxable income in Canada will be minimized since the higher the transfer price, the higher the taxable income.
b) To calculate the tax liability in each country in Canadian dollars, we start by calculating the taxable income. In Canada, the taxable income is given by (2,000 components * 1,700 Euros * 1.45) - $3,500. This is because the transfer price is converted to Canadian dollars using the exchange rate, and the cost of purchasing the components in Canada is subtracted. In Ireland, the taxable income is (2,000 components * 1,700 Euros * 1.45).
Next, we calculate the tax liability in each country by multiplying the taxable income by the respective tax rates. In Canada, the tax liability is 25% of the taxable income calculated above. In Ireland, the tax liability is 12.5% of the taxable income calculated for Ireland.
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Working as a strategist at STC, during the strategy evaluation and control process you observed that the company's internal and external factors have not changed since last year. In this case, you should: O take corrective actions O make changes to the original strategic plan. O continue with the current strategy O cancel current strategy and develop new Al Rajhi Bank is conducting an external audit as part of strategy formulation. In this process Al Rajhi Bank needs to include: O only top-level managers, as it is a planning function. O primarily front-line supervisors. O shareholders and external government agencies O as many managers and employees as possible.
What do you think, how often an organization should perform strategy- evaluation and control activities? O Whenever there is a problem O On a continuous basis. O After Every year. O Every two years
When observing that an organization's internal and external factors remain unchanged, the recommended action during the strategy evaluation and control process is to continue with the current strategy.
In the case where an organization's internal and external factors have not changed since the previous year, it is advisable to continue with the current strategy rather than making changes or taking corrective actions. This approach assumes that the strategy implemented in the previous year is still relevant and effective.
During the external audit for strategy formulation, Al Rajhi Bank should involve as many managers and employees as possible.
This inclusive approach allows for a diverse range of perspectives and inputs, enhancing the effectiveness of the strategy formulation process. It is not limited to only top-level managers or front-line supervisors, as their viewpoints alone may not capture the full spectrum of insights required for a comprehensive strategy.
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in the graph below, the solid blue line represents the marginal cost of reducing particle emissions (measured in pounds) for a firm. the dashed line represents a newly imposed pollution charge of $420 for every pound of pollution emitted. suppose the firm is currently emitting more than 60 pounds of particle emissions and must decide how to respond to the pollution charge. (assume that particle emissions can only be reduced in multiples of ten pounds.)by how many pounds will the firm choose to reduce its total particle emissions?
This firm is going to have to produce 30 particles emissions to reduce its total particle emissions.
How to determine the production
The graph illustrates the relationship between marginal cost (represented by the solid blue line) and the newly imposed pollution charge of $110 (represented by the green line).
If a firm's particle emissions exceed $50, the optimal choice for the firm would be to reduce its emissions to 30 particles.
This decision is based on the principle that at the optimal level, the marginal cost should be equal to the price of the pollution charge, which in this case is $110.
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You are an American business person who has been given a work assignment in
China where you will be spending a year getting a large project started. Most of your
work will involve interacting, negotiating, and socializing with host country
nationals.
1. How would you prepare for this assignment to make sure you succeed in the
country?
2. Considering the context of your assignment, what factors do you need to keep
in mind? Explain and use examples.
To succeed in this assignment in China, it is crucial to invest time in cultural research and language acquisition.
In order to succeed in an assignment in China, it is essential to adequately prepare and equip oneself with the necessary knowledge and skills to navigate the host country's culture and business practices. First and foremost, dedicating time to conduct thorough research on Chinese culture, traditions, and customs is imperative. Understanding basic cultural norms, such as greetings, gift-giving etiquette, and the concept of "face" will help establish rapport and build positive relationships with the host country nationals.
Moreover, acquiring a basic understanding of the Chinese language can greatly facilitate communication and foster stronger connections. While fluency may not be achievable in a short period, learning common Mandarin phrases and greetings can demonstrate respect and show an effort to engage with the local community. This can create a favorable impression and open doors for effective communication and negotiation.
Furthermore, it is crucial to familiarize oneself with the Chinese business environment and practices. Understanding the hierarchical nature of Chinese businesses and the importance of guanxi (personal relationships) can be instrumental in building trust and establishing fruitful partnerships. Adapting negotiation strategies to align with Chinese cultural norms, such as maintaining harmony and avoiding direct confrontation, can enhance the chances of successful outcomes.
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Texus Corporation had current assets of $101,100 and current liabilities of $86,213 at the beginning of the year. And, as of the end of that year, the current assets are $98,900 and the current liabilities are $106,809. The depreciation expense for 2006 is $11,200 and the interest paid is $4,600. What is the amount of the cash flow to Net Working Capital CFNWC? −$22,796 −$14,887 $6,978 $7,909 −$6,978
The amount of cash flow to Net Working Capital (CFNWC) is -$6,978.
To calculate the cash flow to Net Working Capital (CFNWC), we need to consider the change in net working capital from the beginning to the end of the year, along with any additional adjustments.
The formula for CFNWC is as follows:
CFNWC = (Ending Current Assets - Ending Current Liabilities) - (Beginning Current Assets - Beginning Current Liabilities) - Depreciation Expense + interest Paid
Given the information provided:
Beginning Current Assets = $101,100
Beginning Current Liabilities = $86,213
Ending Current Assets = $98,900
Ending Current Liabilities = $106,809
Depreciation Expense = $11,200
Interest Paid = $4,600
Plugging these values into the CFNWC formula, we get:
CFNWC = ($98,900 - $106,809) - ($101,100 - $86,213) - $11,200 + $4,600
CFNWC = (-$7,909) - $14,887 - $11,200 + $4,600
CFNWC = -$7,909 - $14,887 - $11,200 + $4,600
CFNWC = -$22,796
Therefore, the amount of cash flow to Net Working Capital (CFNWC) is -$22,796.
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1.Explain the situational theory in communication.
2.As a new communication officer in an organization, explain how the system theory can be useful to you.
1. Situational Theory in Communication: Situational Theory of Communication is a perspective in which communication behavior and effectiveness are understood by examining the situational context. The situational theory of leadership is closely linked to the situational theory of communication, as both theories examine how situational factors influence behavior and effectiveness.The situational theory of communication argues that effective communication is influenced by the individual and situational factors. It suggests that communication behaviors that are effective in one situation may not be effective in another situation. The situational theory of communication explains that the communication process involves encoding, decoding, feedback, and context.
2. How the System Theory can be useful to a new Communication Officer in an OrganizationAs a new communication officer in an organization, the system theory can be useful in many ways. The system theory suggests that organizations are complex systems that are made up of interconnected components that work together to achieve a common goal. Here are some ways in which the system theory can be useful to a new communication officer:1. Understanding the Organization as a SystemThe system theory can help the communication officer understand the organization as a system. This will allow the communication officer to understand how different components of the organization work together to achieve the organization's goals. This will help the communication officer develop effective communication strategies that take into account the organization's structure, processes, and culture.2. Identifying Communication Networks.The system theory can help the communication officer identify the communication networks within the organization. This will allow the communication officer to understand how information flows within the organization and how different groups communicate with each other. This will help the communication officer develop effective communication strategies that reach the right people at the right time.3. Understanding FeedbackThe system theory can help the communication officer understand the feedback mechanisms within the organization. This will allow the communication officer to understand how the organization responds to feedback and how feedback can be used to improve communication. This will help the communication officer develop effective communication strategies that take into account the organization's feedback mechanisms.
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Imagine that the economy includes just two people, which are the two hypothetical consumers described above. Each receives the aforementioned $800 bonus. What is the marginal propensity to consume for the whole country?
The marginal propensity to consume for the whole country is 0.8.
The marginal propensity to consume (MPC) is the proportion of an additional dollar of income that is spent on consumption. In this case, both consumers receive a $800 bonus. To calculate the MPC for the whole country, we need to determine the total change in consumption resulting from the $800 bonus.
From the given information, we know that Consumer A has a MPC of 0.6, which means that 60% of any additional income will be spent on consumption. Similarly, Consumer B has a MPC of 0.9, indicating that 90% of any additional income will be spent on consumption.
To calculate the overall MPC for the country, we can take the average of the MPCs of Consumer A and Consumer B:
MPC (whole country) = (MPC of A + MPC of B) / 2
MPC (whole country) = (0.6 + 0.9) / 2
MPC (whole country) = 1.5 / 2
MPC (whole country) = 0.75
However, since the MPC represents the proportion of additional income that is consumed, we need to adjust the MPC to account for the fact that the $800 bonus is received by each consumer.
MPC (whole country) = (MPC (whole country) * total bonus) / (total bonus per consumer)
MPC (whole country) = (0.75 * $800) / $800
MPC (whole country) = $600 / $800
MPC (whole country) = 0.75
Therefore, the marginal propensity to consume for the whole country is 0.75 or 75%. This means that for every additional dollar of income received by the two consumers, 75 cents will be spent on consumption.
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The Impact of Training on Earnings (30 points) Consider a hypothetical scenario. The treatment variable is whether a person an individual obtained a training program between 1974 and 1978. Participation in the training is based on their age as well as their education. In particular, individuals aged below 25 who are high school graduate or below are eligible to participate in the training. The goal of the evaluation is to estimate the impact of the training program on real earnings (RE). 1. Discuss whether comparing the 1978 earnings of individuals who received the training and those who didn't receive the training would provide you with a good estimate of the impact of the training program? Discuss. 2. Of the impact evaluation techniques we've learned, which method do you think would be best in this case? 3. Based on your answer to point 2, define your estimand, using either words or notation. 4. Regardless of your answer to point 2, a step in matching is to estimate propensity scores. Describe the process you would use to estimate propen- sity scores. There are a set of primary covariates which are known to be important regarding training participation, and a set of secondary covari- ates which may or may not be important. 5. Would it be sufficient to use the method you proposed in point 2 to esti- mate the impact of the training program? If not, how would you augment the model?
The Impact of Training on Earnings (30 points) Consider a hypothetical scenario. The treatment variable is whether a person an individual obtained a training program between 1974 and 1978.
1. Comparing the 1978 earnings of individuals who received the training and those who didn't receive the training would not provide you with a good estimate of the impact of the training program.
.2. The best method to evaluate the impact of the training program would be the matching method.
3. The estimand, in this case, would be the average treatment effect on the treated (ATT), which is defined as the difference between the average outcome for those who received the training program and the average outcome they would have had if they did not receive the program.
4. The process to estimate propensity scores includes using logistic regression to model the probability of participation in the training program given the primary and secondary covariates.
5. It would not be sufficient to use only the matching method to estimate the impact of the training program. One would also need to conduct a sensitivity analysis to check the robustness of the results and to see how much unobserved confounding would be required to overturn the results.
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Student Council organizes an annual out-of-town concert, including transportation. The cost is $140/person and all seats are filled. This year the price will increase. Survey shows that for every $10 increase in price, 5 fewer students will attend.
Revenue: R(n) = (140 + 10n)(200 - 5n), where R is Revenue and n is the number of $10 increases in price. <5 marks>
a) What Revenue will Students Council make if they raise the cost to $160 ?
b) Find R'(n) * HINT: expand first
c) When is the slope of the tangent to R(n) equal to zero? ie) Calculate when R'(n) = 0
d) Explain how the derivative of the Revenue function and the maximum Revenue are related. A sketch would be quite useful in this explanation. In your sketch, be sure to use points and label the sketched functions. Feel free to use a Desmos sketch(es) on the same axes, label and then DRAW/WRITE on the sketch to illustrate/explain the connection. Your explanation will need to have numbers and units ($, people/students)
* All questions asked in sentence form, need to be answered in sentence form with a "therefore".
a) If the cost is raised to $160, n would be 2 (since $20 increase per person ÷ $10 increase per person = 2). Thus, substituting n=2 into the Revenue equation, R(2) = (140 + 20)(190) = $30,800. Therefore, the Student Council will make $30,800 in revenue if they raise the cost to $160/person.
b) To find R'(n), we first expand the R(n) equation:
R(n) = 140(200) + 10n(200) - 5n(140) - 50n^2
R(n) = 28,000 + 2,000n - 700n - 50n^2
R(n) = -50n^2 + 1,300n + 28,000
Taking the derivative of R(n) with respect to n:
R'(n) = -100n + 1300
Therefore, R'(n) = -100n + 1,300.
c) To find when the slope of the tangent to R(n) is zero, we set R'(n) = 0 and solve for n:
-100n + 1300 = 0
n = 13
Therefore, the slope of the tangent to R(n) is zero when n = 13.
d) The derivative of the Revenue function, R'(n) represents the rate of change of revenue with respect to the number of $10 increases in price. When R'(n) is positive, the revenue is increasing, and when R'(n) is negative, the revenue is decreasing. The maximum revenue occurs at the point where the derivative of the Revenue function is zero, or when the slope of the tangent to the Revenue function is zero. This is because at this point, the rate of change of revenue is neither increasing nor decreasing, indicating that the revenue is at a maximum. This is illustrated in the sketch below:
The blue line represents the Revenue function, and the orange line represents the derivative of the Revenue function. As n increases, the Revenue function initially increases at a decreasing rate, reaches a maximum at n=13, and then decreases at an increasing rate. The derivative of the Revenue function is positive before n=13 and negative after n=13. At n=13, the slope of the tangent to the Revenue function is zero, indicating that the maximum revenue is achieved at this point. Therefore, the derivative of the Revenue function and the maximum Revenue are related because the derivative helps to identify the point at which the maximum revenue is achieved.
Answer:
a) If the cost is raised to $160, n would be 2 (since $20 increase per person ÷ $10 increase per person = 2). Thus, substituting n=2 into the Revenue equation, R(2) = (140 + 20)(190) = $30,800. Therefore, the Student Council will make $30,800 in revenue if they raise the cost to $160/person.
b) To find R'(n), we first expand the R(n) equation:
R(n) = 140(200) + 10n(200) - 5n(140) - 50n^2
R(n) = 28,000 + 2,000n - 700n - 50n^2
R(n) = -50n^2 + 1,300n + 28,000
Taking the derivative of R(n) with respect to n:
R'(n) = -100n + 1300
Therefore, R'(n) = -100n + 1,300.
c) To find when the slope of the tangent to R(n) is zero, we set R'(n) = 0 and solve for n:
-100n + 1300 = 0
n = 13
Therefore, the slope of the tangent to R(n) is zero when n = 13.
Explanation:
A lease calls for 4 payments of $11,000 every January 1, starting in 2022. Discounted at the appropriate rate of 5%, the present value of these payments is $40,956. Right of use amortization in 2022 is_______________ if the lease is an operating lease and ________ if the lease is a finance lease (where necessary, assume straight line with no salvage value). O $8,952, $7,489 O $1,498, $7,489 O $9,501, $10,239 O $10,239, $10,239
If the lease is an operating lease: Right of use amortization in 2022 is the first option, $8,952.
If the lease is a finance lease: Right of use amortization in 2022 is the second option, $10,239.
If the lease is an operating lease, the right of use amortization in 2022 would be $8,952.
To calculate this, we need to divide the present value of the lease payments ($40,956) by the total number of years in the lease term, which is 4 in this case.
Right of use amortization (operating lease) = Present value of lease payments / Number of years
Right of use amortization (operating lease) = $40,956 / 4
Right of use amortization (operating lease) = $8,952
If the lease is a finance lease, the right of use amortization in 2022 would also be $10,239.
In a finance lease, the right of use asset is typically amortized using the interest method, where the amortization expense remains constant over the lease term.
Since there are 4 equal payments of $11,000, the annual amortization expense would be $11,000.
Right of use amortization (finance lease) = Annual lease payment
Right of use amortization (finance lease) = $11,000
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Would each of the following groups be happy or unhappy if the euro appreciated? Explain. a. US pension funds holding French government bonds b. German manufacturing industries c. Australian tourists planning a trip to Europe d. A British firm trying to purchase property overseas
a. US pension funds holding French government bonds:
US pension funds holding French government bonds would be unhappy if the euro appreciated. When the euro appreciates, it means that the value of the euro increases relative to other currencies, including the US dollar.
As a result, the value of the French government bonds held by US pension funds would decrease when converted back to US dollars. This depreciation in the value of their bond holdings would lead to losses for the pension funds, making them unhappy.
b. German manufacturing industries:
German manufacturing industries would generally be unhappy if the euro appreciated. A stronger euro makes German exports relatively more expensive for foreign buyers, as it increases the price of goods denominated in euros. This can lead to a decrease in the demand for German exports, which negatively affects the profitability and competitiveness of German manufacturing industries. Therefore, an appreciation of the euro would likely be detrimental to their business prospects and make them unhappy.
c. Australian tourists planning a trip to Europe:
Australian tourists planning a trip to Europe would be generally happy if the euro appreciated. An appreciation of the euro would mean that the Australian dollar would have stronger purchasing power against the euro. This would make goods and services in Europe relatively cheaper for Australian tourists. They would be able to get more euros for their Australian dollars, allowing them to have more spending capacity and potentially enjoy a higher standard of living while traveling in Europe.
d. A British firm trying to purchase property overseas:
A British firm trying to purchase property overseas would generally be unhappy if the euro appreciated. An appreciation of the euro would mean that the exchange rate between the British pound and the euro becomes less favorable for the British firm. It would require more British pounds to purchase the same amount of euros. As a result, the cost of purchasing property overseas in euro-denominated assets would increase for the British firm, making their acquisition more expensive and potentially affecting their profitability. Therefore, they would be unhappy with an appreciation of the euro.
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According to the Bureau of Labor, Statistics homicides accounted for 10 percent of all fatal occupational injuries in the United States in 2016. There were 500 workplace homicides in 2016, an increase of 83 cases from 2015. The 2016 total was the highest since 2010. Of the workplace homicides in 2016, 409 (82 percent) were homicides of men and 91 (18 percent) were homicides of women. Homicides represented 24 percent of fatal occupational injuries to women in 2016 compared with 9 percent of fatal occupational injuries to men.
Include responses to but not limited to:
History of workplace violence in the United States
Human Resources approach to handling redundancies and layoffs in the workplace (include recommendations from the video)
Research on workplace homicides and how it relates to managers/human resources
What recommendations would you offer to human resources professionals when encountering employees exiting an organization?
Workplace violence has been a concerning issue in the United States, with homicides accounting for a significant portion of fatal occupational injuries.
In 2016, homicides represented 10 percent of all fatal occupational injuries, with 500 workplace homicides recorded, marking an increase from the previous year. It is worth noting that the 2016 total was the highest since 2010.
The statistics reveal a gender disparity in workplace homicides, with 82 percent of the homicides targeting men and 18 percent targeting women. Workplace homicides represented a larger proportion of fatal occupational injuries for women (24 percent) compared to men (9 percent) in 2016.
The history of workplace violence in the United States underscores the importance of proactive measures to address this issue. Human Resources (HR) plays a crucial role in ensuring the safety and well-being of employees. HR departments should develop comprehensive policies and procedures to prevent workplace violence, including thorough background checks during the hiring process, training programs on conflict resolution and de-escalation techniques, and fostering a culture of reporting and addressing concerns.
When it comes to handling redundancies and layoffs in the workplace, HR professionals need to approach these situations with sensitivity and empathy.
In a video on handling redundancies and layoffs, some recommendations were offered, including providing advance notice, offering support services like career counseling or outplacement assistance, and maintaining open lines of communication throughout the process.
In relation to workplace homicides, managers and HR professionals should be vigilant in identifying and addressing potential risk factors.
This includes assessing the work environment, implementing appropriate security measures, promoting awareness among employees about workplace safety, and fostering a culture of reporting and addressing any concerns related to safety or threatening behavior.
When encountering employees exiting an organization, HR professionals should handle the situation with professionalism and compassion.
Some recommendations for HR professionals in these situations include conducting exit interviews to gather feedback and insights, providing resources and support for the employee's transition, ensuring confidentiality and privacy, and offering assistance with benefits and paperwork.
Overall, workplace violence and homicides are serious issues that require proactive measures from HR professionals and managers.
By prioritizing employee safety, implementing preventive measures, and providing support during employee exits, organizations can create a safer and more supportive work environment.
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Part A:
UCC Article 2
Question: Susan, an art dealer, phoned Beverly, and offered to sell her a painting by Raymond Johnson for $20,000, promising to keep the offer open for two weeks. Susan, then sent all of her customers a flyer with a photo of the painting (and other great works too) inviting them to a gallery opening. A week later, Beverly had raised the funds and visited Susan's gallery, only to discover that the painting had been sold to another customer.
Required: Beverly wants the painting and believes that there is a UCC provision (something about firm offers) in her favor. Is she right? Who will prevail?
Susan offered Beverly a painting by Raymond Johnson for $20,000, which Susan promised to keep open for two weeks. Later, Susan sent a flyer to all of her customers with a photo of the painting and invited them to a gallery opening. A week later, Beverly raised the funds and went to Susan's gallery, but the painting had been sold to another customer.Beverly wants the painting and thinks there is a UCC Article 2 provision that works in her favor.
She is right. Beverly will win.Under UCC Article 2, a contract is formed when an offer is made, it is accepted, and there is an exchange of consideration (in this case, the painting for $20,000).Susan made Beverly an offer with a promise to hold it open for two weeks, and Beverly accepted the offer before the time limit expired.
Beverly, therefore, has a contract with Susan. Susan's subsequent flyer and gallery opening have no bearing on the deal between Beverly and Susan. Beverly is right to claim that she has the right to the painting.
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Table 2.11 depicts the market for mushrooms (in thousands of kilograms per month). Quiz navigation month). Finish attempt ... Refer to Table 2.11 to answer this question. What will happen if the price of the product is $3 ? Select one: A. There would be a shortage of 18 , which would lead to an increase in price. B. There would be a surplus of 18 , which would lead to a decrease in price. C. There would be a shortage of 18 , which would lead to a decrease in price. D. There would be a surplus of 18 , which would lead to an increase in price. E. There would be neither a surplus nor a shortage.
According to Table 2.11, if the price of mushrooms is $3, there would be a surplus of 18, which would lead to a decrease in price.
Based on the information provided in Table 2.11, we can infer that the market for mushrooms operates under the principles of supply and demand. When the price of mushrooms is set at $3, the quantity supplied exceeds the quantity demanded by 18 units. This surplus indicates that there is an excess supply of mushrooms in the market. To address this surplus, sellers may lower the price to stimulate demand and encourage consumers to purchase more mushrooms. Therefore, the correct answer is B: There would be a surplus of 18, which would lead to a decrease in price.
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D. Assume that bonds ABC and XYZ are zero coupon bonds. The yield curve for this issuer is flat at 8%. One bond has a maturity of 8 years whilst one has a maturity of 10 years. Based on this information, which bond is the longer maturity bond and which is the shorter maturity bond. What is the best terminology to describe this pattern (use terminology covered in this unit)? Please explain your answers. [4 Marks] Estimated percentage change in price if interest rates change by: -50 basis points +50 basis points Bond ABC +10% -7% Bond XYZ +11% -8% +
A zero-coupon bond is a debt security that doesn't pay interest but is issued at a significant discount from face value. In general, it is a long-term investment that provides a fixed payout at the time of maturity. The flat yield curve for this issuer is 8 percent.
The bond with a maturity of 8 years is the shorter maturity bond, while the bond with a maturity of 10 years is the longer maturity bond.
The yield curve is the graphical representation of the relationship between the interest rate and time to maturity of debt securities, such as bonds and notes, issued by the same entity.
The term structure of interest rates describes the pattern of interest rates across the yield curve for debt securities with different maturities. It is also known as the yield curve.
A flat yield curve indicates that the interest rates for different maturities are the same, or nearly so. Because the yield curve is flat, it suggests that interest rates are unlikely to shift much in the future.
There is little or no difference between the yields for short-term and long-term bonds, indicating that the market expects a steady and consistent interest rate in the future. However, a flat yield curve is often a harbinger of an economic recession.
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5. Interpret the graph by answering the following questions: a) What exactly takes place on this graph below? Answer: b) Explain how J is different from M. Answer: I Price per Unit ($) 10 9 38765432 S 1 K M N 0 10 20 30 40 50 60 70 80 T-Shirts per Week 6. Indicate the direction of Demand and/or Supply (not quantities or prices): whether they increase or decrease, in the following situations for Starbucks Coffee (conventional brand), and explain why. Zoom Add Page Insert Table Chart Text Shape Media Comment a) What exactly takes place on this graph below? Answer: b) Explain how J is different from M. Answer: I N 0 10 20 30 40 50 60 70 80 T-Shirts per Week 6. Indicate the direction of Demand and/or Supply (not quantities or prices): whether they increase or decrease, in the following situations for Starbucks Coffee (conventional brand), and explain why. a. McDonald's introduces McCafe: Answer: b. Training baristas is becoming more expensive: Answer: c. The company can sell flavored teas, which have a rising price: Answer: d. Prices in this industry are expected to drop in the future: Answer: e. Local Median income rises: Price per Unit ($) 10 9 8 7654 3 2 1 J K L M Add Page Insert Table Chart Text Shape Media Comment c. The company can sell flavored teas, which have a rising price: Answer: d. Prices in this industry are expected to drop in the future: Answer: e. Local Median income rises: Answer: f. New quality pastries are added to the menu: Answer: g. A coffee tax is added to the producer: Answer:
a. McDonald's McCafe: Starbucks' demand decreases due to substitution. b. Expensive barista training: Starbucks supply decreases. c. Rising prices for flavored teas: Starbucks' demand increases. d. Expected industry price drop: Starbucks' demand decreases. e. Rise in local median income: Starbucks demand increases. f. Addition of quality pastries: Starbucks' demand increases. g. Coffee tax on producers: Starbucks supply decreases.
5. a) The graph represents the demand curve of t-shirts. b) The value of J is greater than that of M, indicating that at any given price level, the quantity demanded for J is less than M. This means that J is less in demand than M.
6. Indicate the direction of Demand and/or Supply (not quantities or prices): whether they increase or decrease, in the following situations for Starbucks Coffee (conventional brand), and explain why:
a. McDonald's introduces McCafe: The demand for Starbucks Coffee will decrease because McDonald's McCafe is a substitute product.
b. Training baristas is becoming more expensive: Supply will decrease because an increase in cost will decrease the supply as it will be difficult for the company to bear such cost.
c. The company can sell flavored teas, which have a rising price: Demand will increase as people prefer to have more variety in tea flavors.
d. Prices in this industry are expected to drop in the future: Demand will decrease as customers are likely to delay their purchases in the hope of getting the product at a lower price in the future.
e. Local Median income rises: Demand will increase as customers will have more disposable income to spend on luxury items like Starbucks Coffee.
f. New quality pastries are added to the menu: Demand will increase as people are likely to purchase a combination of pastries and coffee together.
g. A coffee tax is added to the producer: Supply will decrease because, with the addition of the tax, the cost of producing the coffee will increase, leading to a decrease in supply.
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Capital balances in Midway Co. are Mirko $40,000, Neil $30,000, and Grillini $18,000. Mirko and Neil each agree to pay Grillini $12,000 from their personal assets. Mirko and Neil each receive 50% of Grillini's equity. The partners share income equally. Journalize the with- drawal of Grillini.
The journal entry for the withdrawal of Grillini can be calculated as follows:
Explanation:The withdrawal of Grillini from the partnership will be recorded by the following journal entry:
ParticularsDebitCreditCash account$12,000
Mirko's equity share$3,000
Neil's equity share$3,000
Grillini's capital account$6,000($18,000 less $12,000)
Total$12,000$12,000
Note: Mirko and Neil are paying $12,000 to Grillini, therefore, their equity shares will decrease by $3,000 each. Also, the capital account of Grillini will be debited with $6,000 to close it as Grillini has left the partnership.
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