In a probability-proportional-to-size sample with a sampling interval of $5,000, an auditor discovered that a selected account receivable with a recorded amount of $3,000 had an audit amount of $2,700. If this were the only error discovered by the auditor, the projected error of this sample would be $300.
In probability-proportional-to-size sampling, the sampling interval is the factor used to determine the size of the sample. In this case, the sampling interval is $5,000, meaning that the size of the sample is determined by multiplying the size of the population by $5,000. The size of the population in this case is $3,000, which means that the sample size is $15,000.
The auditor then randomly selects an account receivable from the sample size of $15,000 and discovers that the recorded amount of $3,000 is different from the audit amount of $2,700. This difference of $300 is then used to calculate the projected error.
The formula for calculating the projected error is: (observed error/sampling interval) x population size. In this case, the observed error is $300 and the sampling interval is $5,000, so the formula becomes: (300/5000) x 3000 = 300. Therefore, the projected error of this sample is $300.
In conclusion, when a probability-proportional-to-size sample with a sampling interval of $5,000 is used and an auditor discovers that a selected account receivable with a recorded amount of $3,000 has an audit amount of $2,700, the projected error of this sample would be $300.
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the amount the seller expects to be entitled to receive from the customer in exchange for providing goods or services is referred to as the
The amount the seller expects to be entitled to receive from the customer in exchange for providing goods or services is referred to as the price.
The price is typically determined by the buyer and seller in negotiation, and can be influenced by a variety of factors, such as supply and demand, cost of production, quality of the product or service, and the customer's ability to pay.
Generally, the seller will seek to maximize their profit by setting a higher price, while the buyer will aim to get the best deal possible by negotiating a lower price.
The ultimate price of a product or service is determined by the amount both parties are willing to accept.
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suppose the market clearing price is $15 and the price ceiling is $17. the price that prevails in the market will be group of answer choices $15. more than $17. $17. less than $15.
Suppose the market clearing price is $15 and the price ceiling is $17. Then The price that prevails in the market will be $17.
What is the market clearing price? The market clearing price is a situation in which the number of goods and services demanded is equal to the number of goods and services supplied. It is the point where the buyers and sellers agree on a price at which they are willing to trade.
A price ceiling is the highest price that can be legally charged for a good or service. It is used by the government to protect consumers from price gouging by suppliers. This is often done in industries where supply is limited and the demand is high.
The price that prevails in the market will be $17 because the price ceiling is $17. This means that suppliers can't charge more than $17. The market clearing price is $15, which is lower than the price ceiling. Since suppliers can't charge more than $17, they will charge $17, which is the highest price they can charge.
So, the price that prevails in the market will be $17.
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peng company is considering buying a machine that will yield income of $3,100 and net cash flow of $15,900 per year for three years. the machine costs $45,900 and has an estimated $7,500 salvage value. compute the accounting rate of return for this investment.
The accounting rate of return for this investment is -0.65.
The accounting rate of return for this investment can be computed using the following formula: ARR = (Annual Net Cash Flow – Initial Investment) / Initial Investment.
In this case, the initial investment is $45,900, and the annual net cash flow is $15,900.
So, the accounting rate of return can be calculated as follows:
ARR = ($15,900 - $45,900) / $45,900 = -0.65
Therefore, the accounting rate of return for this investment is -0.65.
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suppose kenji owns and operates a pizza parlor. the interest kenji could earn by selling his pizza ovens, and placing that money in the bank or investing it in the stock market, is an cost. true or false?
False, the interest Kenji could earn by selling his pizza ovens and placing that money in the bank or investing it in the stock market is an opportunity cost.
Is the statement correct?Opportunity cost refers to the potential benefits that an individual, investor, or business misses out on when choosing one alternative over another. In this case, the alternative is selling the pizza ovens and earning interest on the investment.
As for the specific question, the statement "the interest Kenji could earn by selling his pizza ovens, and placing that money in the bank or investing it in the stock market, is a cost" is false.
Interest is a return on investment, not a cost. If Kenji were to sell his pizza ovens and invest the money in the bank or stock market, he would earn interest on that investment. This would be a benefit or gain, not a cost.
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let the price of good q 1 initially be $20 and the price of good q 2 be $10. kayla has income of $1,800. if the price of good q 1 increases from $20 to $60, what is kayla's compensating variation? kayla's compensating variation (cv) is
Kayla's compensating variation is 10 - (-900) = $910. This is the amount of additional income she would need in order to remain as satisfied with her current consumption as before the price of good Q 1 increased from $20 to $60.
Kayla's compensating variation is the amount of additional income she would need in order to remain as satisfied with her current consumption as before the price of good Q 1 increased from $20 to $60. This increase in price causes a decrease in Kayla's real income, and the compensating variation measures the amount of additional income that would be needed to compensate for the decrease in real income.
To calculate the compensating variation, the first step is to calculate the budget line. The budget line is the line that represents all combinations of good Q 1 and good Q 2 that Kayla can purchase with her income of $1,800. Assuming that the price of good Q 1 has increased from $20 to $60, and the price of good Q 2 is still $10, Kayla can purchase a maximum of 30 units of good Q 1 and 180 units of good Q 2. The budget line equation can be calculated using the two price and income values:
30Q1 + 180Q2 = 1,800
The second step is to calculate the maximum utility Kayla can obtain from the budget line. This can be calculated by considering Kayla's utility function. If Kayla has an additive utility function of U = Q1 + Q2, then the maximum utility she can obtain from the budget line is 30 + 180 = 210.
The third step is to calculate the equivalent variation. This is the amount of income that would need to be taken away from Kayla in order to leave her with the same level of utility she had before the price of good Q 1 increased from $20 to $60. In this case, the equivalent variation is the difference between the maximum utility that Kayla can obtain before and after the price change. Since the maximum utility before the price change was 200, and the maximum utility after the price change was 210, the equivalent variation is 10.
Finally, Kayla's compensating variation is the difference between the equivalent variation and the change in real income caused by the price change. In this case, the change in real income is -$900, since the price of good Q 1 has doubled.
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The CPI will be ________ when there is ________ in the quality of a good and its price remains the same.
a. understated; decline
b. overstated; no change
c. overstated; decline
d. overstated; improvement
e. understated; no change
The CPI will be understated when there is an improvement in the quality of a good and its price remains the same. The correct answer is option A.
The CPI (Consumer Price Index) measures the weighted average of prices of a basket of consumer products and services such as transportation, food, and medical care. It's used to track inflation in the economy by measuring price changes in consumer goods over time. Inflation can also be measured by the increase in the CPI over time.
When the quality of a good improves, it generally means that the product has become better, so the consumer may be willing to pay more for it. This, on the other hand, would result in a rise in the product's price. However, the CPI calculation would not account for the increase in the value of the good due to the improved quality. This would result in a miscalculation of inflation and an understatement of the CPI.
The CPI, therefore, is understated when there is improvement in the quality of a good and its price remains the same. So, the correct answer is option A.
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suppose a food company wants to develop a version of their best-selling granola bar that is more filling without adding additional calories. what ingredient might they add and why?
If a food company wants to develop a version of their best-selling granola bar that is more filling without adding additional calories, they can add fibers to it.
Why is fiber the best ingredient to add to a granola bar?
Fiber is the best ingredient to add to a granola bar because it is an essential nutrient that contributes to the overall well-being of the body. It can aid in weight management, help to reduce the risk of chronic diseases like heart disease, and help to maintain bowel health. Foods that are high in fiber are typically low in calories and fat, making them ideal for individuals who want to consume fewer calories without sacrificing taste or satisfaction.
In addition, fiber is more filling than other nutrients such as carbohydrates, so adding fiber to granola bars can help to satisfy hunger and reduce the desire to snack on unhealthy foods.
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which individual would be classified as a discouraged worker? multiple choice mollie george jeanette ricardo
Ricardo would be classified as a discouraged worker. In this case option D is correct
A disenchanted worker is typically someone who is able to work, has actively sought employment in the past, but has given up on doing so because they feel there are no chances for employment in their field or because they have become weary of the job search process.
Even if they are still of working age and have the capacity and want to work, this person is not now included in the labour force since they are not actively looking for job.
In this case option D is correct
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economic surplus measures the value of a decision's: group of answer choices total costs minus its net benefits. total benefits minus its total costs. total costs minus its benefits minus gains from exploitation. benefits minus its costs plus externalities.
The economic surplus measures the value of a decision's is total benefits minus its total costs (option b)
The economic surplus is the difference between the value that a person places on a good or service and the price they actually pay for it. This difference is known as consumer surplus.
On the other hand, producer surplus is the difference between the price that a seller receives for a good or service and the cost of producing it. When both of these surpluses are combined, we get the total economic surplus.
In conclusion, economic surplus is a fundamental concept in economics that measures the overall value created by a decision or a choice. It is calculated by subtracting the total costs from the total benefits and is made up of consumer surplus and producer surplus.
So, the correct option is (b).
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how many years will it take to double your money at 6% compounded semi-annually? group of answer choices 15 20 11.72 8.7
To double your money at 6% compounded semi-annually, it will take approximately C). 11.72 years.
The definition of compound interest is the term used for this type of interest calculation based on the initial principal amount plus the accumulated interest from the previous period. In financial terms, interest itself is a reward in the form of money paid for the use or storage of money.
The formula for this calculation is P(1 + r/n)nt = 2P, where P is the principal amount, r is the annual rate, n is the number of compounding periods per year, and t is the number of years. In this case, P = 1, r = 6%, n = 2, and t = 11.72. So the answer is C. 11,72.
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what is the term for imputing the benefit of a proposed government project or service when no market price exists?
The term for imputing the benefit of a proposed government project or service when no market price exists is Shadow Pricing.
When the market price of goods or services is not available, shadow pricing is a method of determining the value of goods or services. The government may employ shadow pricing to evaluate proposed government projects or services when market prices are unavailable.
The process of estimating the value of a product or service by measuring the value of similar goods or services in the market is known as shadow pricing.
Shadow pricing may also include gauging the impact of a product or service on social welfare, the environment, or other factors that are not reflected in the market price.
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which organization tests products for electrical and fire safety to ensure items meet safety standards
The organization that tests products for electrical and fire safety to ensure items meet safety standards is the Underwriters Laboratories (UL). Underwriters Laboratories Inc. is an American safety consulting and certification company, headquartered in Illinois.
UL is an independent, non-profit organization that has been testing and certifying products for over a century to ensure that they meet safety standards. They develop safety standards, test products to ensure they meet those standards, and then certify those products.
They work with manufacturers, retailers, and regulators to ensure that products are safe for consumers to use.UL has developed over 1,500 safety standards, including standards for electrical safety, fire safety, environmental safety, and chemical safety.
They test products ranging from home appliances to industrial equipment to ensure that they meet these safety standards. They have laboratories all over the world, including the United States, Canada, Europe, and Asia.
UL-certified products bear a mark or label that indicates that they have been tested and certified to meet safety standards, and consumers can look for this mark when purchasing products to ensure that they are safe to use. UL is committed to safety, and their testing and certification process helps to ensure that products are safe for consumers to use.
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assume that the value of a financial institution's liabilities equals that of its assets. if the durations of its asset portfolio are than the durations of its liability portfolio, then the market value of the assets is interest-rate sensitive than the market value of the liabilities. a. greater; more b. greater; equally c. greater; less d. less; equally e. b and d
The correct option is C. greater; less. Assuming that the value of a financial institution's liabilities equals that of its assets.
If the durations of its asset portfolio are less than the durations of its liability portfolio, then the market value of the assets is more interest-rate sensitive than the market value of the liabilities.
How are financial institutions affected by interest rate changes? Interest rates and bond prices are inversely related. When interest rates rise, bond prices fall, and when interest rates fall, bond prices rise. This is why interest rates are critical to bondholders.
When interest rates rise, the value of existing bonds decreases because the new bonds have a higher interest rate. The market value of the asset portfolio will be more interest-rate sensitive because the assets will lose more value as interest rates rise.
When interest rates rise, the bank's assets will decline in value more than the bank's liabilities will. The difference in the sensitivity of the two portfolios is due to the bank's short-term interest rates exposure.
So, greater; less is the correct option.
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voluntary arrangements to restructure a company's debt to avoid bankruptcy may be beneficial to all involved parties. this may involve .
Voluntary arrangements to restructure a company's debt to avoid bankruptcy may be beneficial to all involved parties. This may involve reducing the amount of debt a company owes, restructuring the terms of repayment, or refinancing the debt to lower the interest rate.
Companies may also choose to combine existing debt with new debt, or accept equity investments in lieu of debt repayment.
These voluntary arrangements have the potential to be beneficial to all parties involved. The creditors can rest assured that their debt is being paid, the company can avoid bankruptcy and save money in the long run, and shareholders can be assured of continued operations.
It is important to remember, however, that any debt restructuring must be carefully evaluated in order to determine if it is the most beneficial option. The company must also consider how the restructuring will impact its credit rating, which could have a long-term effect on its ability to obtain financing in the future.
In summary, voluntary arrangements to restructure a company's debt to avoid bankruptcy can be beneficial to all involved parties. Companies must be sure to carefully evaluate any restructuring plan before entering into an agreement to ensure it is the best option for all involved.
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a price elasticity of demand of -0.50 means that if the price increases by 1%, the quantity demanded will
APrice Elasticity of Demand of -0.50 means that a 1% increase in price will result in a 0.50% decrease in the quantity demanded. So, if the price of a good increase by 1%, the quantity demanded will decrease by 0.50%. The (PED) is used to determine the responsiveness of quantity demanded to changes in price.
What is the Price Elasticity of Demand?It is defined as the percentage change in quantity demanded divided by the percentage change in price. If the PED is negative, it indicates that the quantity demanded is inversely related to the price of the good.
This indicates that the demand for the good is somewhat price inelastic, as a small increase in price will result in a proportionately smaller decrease in the quantity demanded. This implies that the producer may increase the price of a good and still sell the same quantity.
On the other hand, if the PED were greater than one, indicating that the demand for a good is price elastic, a small increase in price would result in a proportionately larger decrease in quantity demanded, and a larger increase in price would result in a larger decrease in quantity demanded.
Hence, the producer may need to lower the price of the good to sell the same quantity.
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you need a 35-year, fixed-rate mortgage to buy a new home for $245,000. your mortgage bank will lend you the money at an apr of 5.4 percent for this 420-month loan. however, you can afford monthly payments of only $850, so you offer to pay off any remaining loan balance at the end of the loan in the form of a single balloon payment. how large will this balloon payment have to be for you to keep your monthly payments at $850? (do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
The amount of the balloon payment required to maintain the monthly payments at $850 is $111,720.61.Monthly payments.Thus, the balloon payment required to maintain the monthly payments at $850 is $107,422.39.
PV = $245,000 - BThe number of payments is 420 months.n = 420The interest rate is 5.4% per annum, compounded monthly.
Thus, we have:r = 5.4% / 12r = 0.0045The monthly payment is $850.PMT = $850Substituting the given values in the loan repayment formula,PV = PMT × [(1 - (1 + r)-n) / r] + B × (1 + r)-n$245,000 - B = $850 × [(1 - (1 + 0.0045)-420) / 0.0045] + B × (1 + 0.0045)-420Simplifying the equation,$245,000 - B = $850 × 14.211 + B × 0.1691$245,000 - B = $119,179.35 + 0.1691 BCollecting like terms,1.1691 B = $125,820.65B = $107,422.390
Thus, the balloon payment required to maintain the monthly payments at $850 is $107,422.39.
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the decision of comparing the costs of manufacturing in-house to the costs of outsourcing production to another firm is called
The decision of comparing the costs of manufacturing in-house to the costs of outsourcing production to another firm is called a cost-benefit analysis.
A cost-benefit analysis is used to determine which production method is the most profitable. It considers the costs associated with both in-house and outsourcing production, such as labor, materials, and overhead.
It also considers potential benefits, such as increased efficiency and improved quality. By weighing the cost and benefits of each production method, a company can decide which production method is most beneficial.
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if the budget were required to be balanced each fiscal year, then the role of automatic stabilizers would:
If the budget were required to be balanced each fiscal year, then the role of automatic stabilizers would be to stabilize the economy in difficult times.
How can automatic stabilizers stabilize the economy?Automatic stabilizers, such as welfare systems, progressive tax structures, and other social security measures, are built into the fiscal policy of governments. They are meant to work passively and automatically, that is, without the need for any political or administrative decisions to be made.
The fiscal policy is adjusted to the economy's natural forces automatically, which assists in stabilizing it. This implies that these stabilizers help the economy in the times of recession and, by extension, help balance the budget. As a result, the government will not need to force a balanced budget in the short term or take other steps to correct the fiscal deficit.
Instead, the country's economy is kept afloat thanks to these stabilizers.What are automatic stabilizers?Automatic stabilizers refer to a collection of government programmes and policies that are meant to help stabilize an economy during a recession.
These stabilizers are automatic in nature, which means they don't require any additional legislation or administrative decisions to be activated. Social welfare systems, progressive tax structures, and other government-funded social security measures are examples of automatic stabilizers.
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compared to the european union, the north american free trade agreement .has a stronger currency linkage due to the u.s. dollaris significantly larger in population and total gnihas more trade problems since it is a customs unionis slightly smaller in population and gdp
As compared to the European Union, the North American Free Trade Agreement (NAFTA) has a stronger currency linkage due to the U.S. dollar.
It is slightly smaller in population and GDP. NAFTA is a free trade agreement signed by Canada, the United States, and Mexico.
The North American Free Trade Agreement (NAFTA) is an agreement that was signed on January 1, 1994, by Canada, the United States, and Mexico. The objective of the North American Free Trade Agreement was to eliminate trade barriers between the three nations, namely Canada, the United States, and Mexico, and to foster a free trade zone.
The North American Free Trade Agreement was signed on January 1, 1994, by Canada, the United States, and Mexico. The agreement is aimed at eliminating trade barriers between the three nations and establishing a free trade zone. This agreement allows a significant amount of goods and services to flow across borders without tariffs or restrictions, benefiting businesses and consumers alike.
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one of the main issues that some team members do not have faith each other. this issue is primarily related to a lack of
One of the main issues that can arise within a team is a lack of trust among team members. This issue is often related to a lack of communication, transparency, or consistency within the team.
To address this issue, team members should engage in open and honest communication to build trust and establish clear expectations. This includes setting and adhering to team goals, providing feedback and support, and encouraging collaboration and accountability.
Team members should also be encouraged to share their strengths and weaknesses to promote mutual understanding and support. Additionally, team-building activities and workshops can help foster a sense of camaraderie and trust among team members.
By addressing the root cause of the issue and actively working to build trust, teams can overcome this challenge and work together more effectively.
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decision making reflects relatively permanent changes in an employee's knowledge and skills that result from experience. true or false
The statement "Decision making reflects relatively permanent changes in an employee's knowledge and skills that result from experience." is true because decision making is the process of making choices between two or more available options and it is an important part of managing employees in any organization.
Decision making reflects relatively permanent changes in an employee's knowledge and skills that result from experience, such as knowledge acquired through work assignments and the ability to assess situations and identify the best possible solution. By making decisions, employees gain insight into their abilities and learn how to better manage tasks and improve their performance. Decision making also helps employees develop their problem-solving skills, which are necessary to effectively manage projects. As employees learn more about decision making, they can become more adept at making decisions in any situation and gain confidence in their own abilities.
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[FILL IN THE BLANK] Mowery Enterprises reported accounts receivable of $50,000 in 2016. They expect to recover the cash from these receivables in 2017 and 2018. Because accounts receivable have a zero tax basis, this will result in a ________ for 2016.
In 2017 and 2018, they want to recover the money from these receivables. Accounts receivable's zero tax basis means that this will provide taxable incomes for 2016.
Explanation:Accounts receivable is the amount a company expects to receive from its clients or customers. Accounts receivable is an asset in the business accounting ledger. These accounts have a zero tax basis, meaning that they cannot be deducted as a tax expense.
The amount of accounts receivable in 2016 was $50,000, and it is expected that cash will be received from these accounts in 2017 and 2018.The receipt of cash from accounts receivable is taxable income to the company. As a result, the firm will report a gain for 2016.
Any gross income that is used to determine how much tax you owe is referred to as taxable income. It is simply your actual gross income excluding any deductions, to put it simply. Included in this are any pay, tips, salaries, & bonuses received from employers. Furthermore included are investments and unearned income.
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if freeman violates the terms of its labor-management agreement, what can an individual union employee do? multiple choice go on strike file a grievance
If Freeman violates the terms of its labor-management agreement, an individual union employee can file a grievance.
What is a grievance?A grievance is a formal written complaint filed by an employee who believes that the employer has violated their rights under the collective bargaining agreement. This can include things like violating workplace safety rules or unfairly disciplining employees, among other things.
If a union worker has a problem with an employer's breach of the labor-management agreement, they may file a grievance. The worker must present their case to their union representative, who will then file the grievance on their behalf, according to the terms of the collective bargaining agreement.
The employer and the union representative will then attempt to resolve the issue through negotiation, and if no resolution is reached, an arbitration hearing may be held.
If Freeman violates the terms of its labor-management agreement, an individual union employee can file a grievance. Therefore, the correct answer is option b. file a grievance.
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taylor company purchased a machine and plans to depreciate it over its estimated useful life of 10 years. over the next four years, the machine was used more extensively than originally estimated, so taylor revised the useful life estimate to a total of 8 years. this change should be accounted for as a:
Answer:change in accounting estimate, with a prospective approach.
Explanation:
the more inelastic the demand for a product, the more likely that the actual benefit of a subsidy granted on the product will a. go to sellers. b. go to buyers. c. go equally to both buyers and sellers. d. do none of the above.
The actual benefit of a subsidy granted on a product with inelastic demand will go to buyers. Option B is correct.
Inelastic demand means that the quantity demanded of a product is not very responsive to changes in price. In other words, even if the price of the product increases, the quantity demanded does not decrease by a significant amount.
When a subsidy is granted on a product, it effectively reduces the price that the buyer pays, while the seller still receives the full market price. Therefore, when the demand for a product is inelastic, the benefit of the subsidy is more likely to be captured by the buyer, in the form of lower prices, rather than the seller, in the form of increased profits. This is because the seller can maintain a higher price while still selling the same quantity of product.
On the other hand, when the demand for a product is elastic, the benefit of the subsidy is more likely to be captured by the seller, in the form of increased profits, rather than the buyer, in the form of lower prices. This is because the seller needs to lower the price in order to sell the same quantity of product. Therefore, the more inelastic the demand for a product, the more likely that the actual benefit of a subsidy granted on the product will go to buyers, not sellers. Option B is correct.
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if a household has $40,000 in taxable income and its tax liability is $4,000, the household's average tax rate is a. 10 percent. b. 25 percent. c. 40 percent. d. 50 percent
Answer: a
Explanation:
A. 10 percent. The taxable income of $40,000 and the tax liability of $4,000 results in an average tax rate of 10 percent ($4,000 / $40,000 = 0.10, or 10 percent).
The average tax rate of a household having $40,000 in taxable income and $4,000 in tax liability is 10 percent.How to determine the average tax rate of a household?Taxable income is the amount of income that is subject to tax. Tax liability is the amount of tax that an individual owes. Average tax rate is the percentage of income that an individual pays in taxes. It can be calculated by dividing tax liability by taxable income.
The formula for average tax rate is given as:
Average Tax Rate = Tax Liability/Taxable Income
Given, Taxable income = $40,000Tax liability = $4,000Therefore, the average tax rate of the household is:
Average Tax Rate = Tax Liability/Taxable Income= $4,000/$40,000= 0.10 or 10%
Thus, the average tax rate of the household having $40,000 in taxable income and $4,000 in tax liability is 10 percent. Hence, the answer is option a. 10 percent.
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mandy has a large art-supply company that sells through both her brick-and-mortar store and online. she wants to increase the awareness of her brand and drive higher sales. how can display ads help mandy achieve her business objectives?
Mandy can use display ads to help her achieve her business objectives by increasing the visibility of her art-supply company and driving higher sales. Display ads are a cost-effective way of gaining exposure for her business, as they allow her to target a wide range of potential customers.
Display ads are also easily customizable, allowing her to tailor her messages and visuals to meet her specific needs. Additionally, display ads can be tailored to measure the performance of campaigns and provide valuable insights that can be used to optimize her marketing efforts. In short, display ads can help Mandy increase the awareness of her brand and drive higher sales by providing a cost-effective, customizable, and measurable marketing platform.
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When the committee ___to a decision, we will proceed with the plan.
"When the committee comes to a decision, we will proceed with the plan."
This sentence indicates that there is a plan waiting to be executed, but it is dependent on the decision made by the committee. Until the committee reaches a conclusion or makes a decision, no action can be taken. The sentence suggests that the decision-making process is ongoing, and it may take some time before a decision is reached.
It is important to wait for the committee's decision before proceeding with the plan to ensure that all parties involved are in agreement and that the plan is executed effectively.
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Compared with other displaced workers, ______________ workers tend to face ___________ adjustment costs as they must endure longer ____________ spells & larger wage losses once reemployed.
A. unemployed, lower, nonproductive
B. trade-displaced, higher, unemployment
C. unemployed, higher, nonproductive
D. trade-displaced, lower, unemployment
Compared with other displaced workers, Trade-displaced workers tend to face higher adjustment costs as they must endure longer unemployment spells & larger wage losses once reemployed.(B)
Displaced workers are people who have lost or left their jobs due to the firm's closure or layoffs, as well as various other reasons such as technological advancements or import competition. Adjustment costs refer to the expenses incurred when a company makes significant modifications to its operations.
As a result, displaced workers who need to adjust to a new work environment have to face adjustment costs.Workers who have lost their jobs due to import competition are referred to as trade-displaced workers.
Trade-displaced workers are facing several challenges, including finding new jobs, learning new skills, and adapting to new work environments.
Trade-displaced workers tend to face higher adjustment costs as they must endure longer unemployment spells and larger wage losses once reemployed compared to other displaced workers. They must also find new jobs, learn new skills, and adapt to new work environments. Thus, the correct answer is , trade-displaced, higher, unemployment.(B)
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Gary King is interested in purchasing the common stock of Cullumber, Inc., which is currently priced at $56.89. The company is expected to pay a dividend of $2.58 next year and to increase its dividend at a constant rate of 9.40 percent.
What should the market value of the stock be if the required rate of return is 14 percent? (Round answer to 2 decimal places, e.g. 15.20.)
Is this a good buy?
Market Value of Stock = $36.85. Yes, this is a good buy for Gary King because company is expected to pay a dividend of $2.58 next year and to increase its dividend at a constant rate of 9.40 percent.
Calculation:
Current price of stock = $56.89
Expected dividend next year = $2.58
Growth rate of dividend = 9.40%
Required rate of return = 14%
Calculate the dividend of the next year:
Expected dividend of next year = Dividend of the current year × (1 + Growth rate)
Expected dividend of next year = $2.58 × (1 + 9.40%)
Expected dividend of next year = $2.82
Calculate the present value of the dividend:
Present value of dividend = Expected dividend / (1 + Required rate of return)^n
Present value of dividend = $2.82 / (1 + 14%)¹
Present value of dividend = $2.47
Calculate the present value of the stock using the dividend discount model:
Market Value of Stock = Present value of dividend + Present value of stock
Market Value of Stock = $2.47 + PV (of stock)
PV (of stock) = Market Value of Stock - Present value of dividend
PV (of stock) = $56.89 - $2.47PV (of stock) = $54.42
Therefore, the Market Value of Stock is $36.85.Yes, it's a good buy for Gary King as the current market price of the stock is less than the market value of the stock.
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