Answers
Answer:
b. a natural response to a sudden increase in demand.
Explanation:
Price gouging -
It refers to the situation , when the seller increases the price of his services and goods to a very high level , which is a unethical situation , is referred to as price gouging .
The situation of price gouging , is very commonly observed in any natural disaster , where due to shortage of foods and other item , the price of the food increases to a very high price , is referred to as price gouging .
Hence , from the question,
The correct option is b.
Related Questions
Refer to exhibit 5-5. If the airline charges a price that is between P1 and P2 for both aisle seats and middle seats, the result will beA. a surplus of middle seats and a shortage of aisle seatsB. a surplus of aisle seats and a shortage of middle seatsC. a shortage of middle seats and the equilibrium quantity of aisle seatsD. a shortage of aisle seats and the equilibrium quantity of middle seats
Watkins Associated Industries is a highly diversified company with three divisions: Trucking, Seafood, and Construction. Assume that the company uses return on investment and residual income as two of the evaluation tools for division managers. The company has a minimum desired rate of return on investment of 10% with a 30% tax rate. Selected operating data for three divisions of the company follow.Trucking Division Seafood Division Construction DivisionSales $1,250,000 $800,000 $950,000Operating assets 650,000 300,000 400,000Net operating income 146,250 52,800 79,6001) Compute the return on investment for each division. 2) Compute the residual income for each division.
Star Company has a contingent liability that has a likelihood of actual occurrence that is classified as probable. Also, the amount of the liability can be reasonably estimated. Under these circumstances, Star is required to
In the situation described in the above question, suppose that the Central Bank of Vietnam decides to keep the nominal dong-dollar exchange rate constant indefinitely. Given whatDEP Inc. has determined about the trend in the real exchange rates and assuming that the rate of inflation in the rest of the world remains unchanged, what should one expect to happen to the rate of inflation in Vietnam over the next several years compared to the past?
Answers
Answer:
Reduces
Raises
Explanation:
Compared to a perfectly competitive firm having the same cost curves, a monopolistically competitive firm reduces output and raises prices.
The topic that explains this is economic efficiency and resource allocation.
Answers
Answer:
Accounts Receivables Turnover Ratio = = 10 times.
Explanation:
Accounts Receivables Turnover ratio =
Here Net Credit Sales = $6.5 million
Accounts Receivables Opening Balance = $600,000
Accounts Receivables Closing Balance = $700,000
Average Accounts Receivable Balance =
Accounts Receivables Turnover Ratio = = 10 times.
This shows that accounts receivables are on an average 1/10th of credit sales.
Final Answer
Accounts Receivables Turnover Ratio = = 10 times.
One way of investing is to purchase stock or bonds from a private company.
Suppose TouchTech, a hand-held computing firm, is selling stocks to raise money for a new lab—a practice known as---------(debt/equity)------ finance. Buying a share of TouchTech stock would give Nick-----(a claim to partial ownership in/an IOU, a promise to pay, from)------- the firm. In the event that TouchTech runs into financial difficulty, --------(nick and the other stockholders/ the bondholders)------will be paid first.
Suppose Nick decides to buy 100 shares of TouchTech stock.
Which of the following statements are correct? Check all that apply.
----Expectations of a recession that will reduce economy-wide corporate profits will likely cause the value of Nick's shares to decline.
----The Dow Jones Industrial Average is an example of a stock exchange where he can purchase TouchTech stock.
----An increase in the perceived profitability of TouchTech will likely cause the value of Nick's shares to rise.
Alternatively, Nick could invest by purchasing bonds issued by the government of Japan.
Assuming that everything else is equal, a bond issued by a government that is engaged in a civil war most likely pays a ----(higher/lower)---- interest rate than a bond issued by the government of Japan.
Answers
Answer:
(1) A practice known as "equity" finance
(2) Busing a share of TouchTech stock would give Nick "a claim to partial ownership"
(3) "the bondholders" will be paid first"
(4) Of the three statements provided, statement # 1 and statement # 3 are correct
(5) A government that is engaged in civil war mist likely pays a "higher" interest rate
Explanation:
Lets look at the answer to each question individually below:
(1) Touch Tech is selling stocks to raise money. The process involves issuing common shares through investment banks in a primary market to raise capital. The firm is essentially selling pieces of itself to investors, or "shareholders" which is known as equity finance
(2) The firm sells a part of itself to the investors who buy stocks and shares in the company. This means that essentially the company is selling ownership up to a certain amount. This gives the shareholders rights to residual income of the company. So each shareholders is a part owner and their individual ownership depends on the percentage of shares that they hold relative to the total shares outstanding.
(3) Shareholders by definition have a claim on the residual income/cashflows of the company. This is income that has been derived after paying for operating activities, other expenses, interest payments, and tax payments. Bondholders are debt holders of a company and in terms of seniority of claim, the debt holders are paid off first. The shareholders come at the very bottom of the hierarchy in terms of getting paid compared to debt holders, the government, and preference shareholders.
(4) Expectation of a recession would mean a company finds it hard to achieve sales and therefore impacts the profitability. If the profitability is impacted negatively, shareholders would get a lower rate of return on their investment which would push down the demand for share, and this is why the price of the shares would likely decline. Similarly, if investors believe the Touch Tech will be able to earn good sales figures and good profitability, the rate of return on investment would be expected to be higher. Therefore, in this case, the increased demand for shared would drive up the price of the shares as well. Therefore both these statements are true,
On the other hand, the Dow Jones Industrial Average is NOT a stock exchange. An example of a stock exchange is the NYSE (New York Stock Exchange) where investors can buy and sale shares. This is the exchange where Nick can buy the shares. The DJIA is simply an index that indicates how the prices of a select number of stocks from across the board are moving. The level at which the DJIA is at gives investors and idea as to how the overall market is performing rather than looking at the share price and volume trades of each individual stock.
(5) A war torn government issuing bonds would be perceived by investors as having difficulties in pay back its debts. Tax collections and economic performance of the country would be deeply impacted by the civil war. This would make the risk of not getting paid back a lot higher for a bondholder than a government that is stable and plenty of cash reserves. To compensate for this added risk, the government of a war torn state would have to offer investors a higher rate of return in exchange for their investment.
A)
7.55%
B)
9.17%
C)
9.00%
D)
8.00%
Answers
Answer:
WACC = 7.55 %
so correct option is A) 7.55%
Explanation:
given data
company raised = $100,000,000
sale of bonds = $50,000,000
current yield = 8%
sale of common stock = $25,000,000
cost equal = 9%
sale of preferred stock =$25,000,000
cost equal = 10%
tax rate = 30%
to find out
WACC
solution
we get here WACC that is express as
WACC = ( Weight of debt × After tax cost of debt) + (Weight of equity × Cost of equity) + (Weight of preferred stock × cost of preferred stock) ..................1
and cost of debt after tax will be
cost of debt after tax = 8% of ( 1 - 30%)
cost of debt after tax = 5.6%
and Weight of debt = = 0.50
and Weight of equity = = 0.25
and Weight of preferred stock = = 0.25
so WACC = ( 0.50 × 0.056 ) + ( 0.25 × 0.09 ) + ( 0.25 × 0.10 )
WACC = 0.0755
WACC = 7.55 %
so correct option is A) 7.55%
Answers
Answer:
8 years
Explanation:
the rule of 72 calculates how long it takes for an amount to double given interest rate
72 / 9% = 8 years
Final answer:
The 'Rule of 72' can be used to estimate how long it would take for prices to double with an inflation rate of 9 percent. According to this rule, it would take approximately 8 years.
Explanation:
In order to calculate how long it would take for prices to double with an inflation rate of 9 percent, you can use the 'Rule of 72'.
The Rule of 72 is a simplified way to estimate the number of years required to double the money at a given annual rate of return or inflation. According to this rule, you simply divide 72 by the annual rate of return or inflation. Therefore, using the Rule of 72, it would take approximately 8 years (72 divided by 9) for prices to double with an inflation rate of 9 percent.
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b. Only CPF solutions can be optimal, so the number of optimal solutions cannot exceed the number of CPF solutions.
c. If multiple optimal solutions exist, then an optimal CPF solu-tion may have an adjacent CPF solution that also in optimal.
Answers
Answer and Explanation:
a. The given statement is true as the corner point at the objective function should be feasible solution which is no longer as compared with the value for every adjacent CPF solution as compared with its optimal
b. The given statement is false as the solution can be an edge
c. The given statement is true as it shows the direct relation between the two things
Final answer:
In linear programming problems, CPF solutions can be optimal and if multiple optimal solutions exist, an optimal CPF solution may not have an adjacent CPF solution that is also optimal.
Explanation:
a. True: For minimization problems, if the objective function evaluated at a CPF solution is no larger than its value at every adjacent CPF solution, then that solution is optimal. This is because in a minimization problem, the goal is to find the solution that minimizes the objective function.
b. True: Only CPF solutions can be optimal, so the number of optimal solutions cannot exceed the number of CPF solutions. CPF stands for Corner-Point Feasible, which means solutions that lie on the corner points of the feasible region.
c. False: If multiple optimal solutions exist, an optimal CPF solution may not have an adjacent CPF solution that is also optimal. This is because adjacent CPF solutions may have different objective function values.
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