Answer:
d. decrease retained earnings $1.88 million and increase liabilities by $1.88 million
Explanation:
Reliability is how long an item or system will perform its function before it breaks. Good reliability will ______________________. Decrease logistics support requirements Increase life cycle sustainment costs Decrease system readiness Increase manpower waste
Answer:
Decrease logistics support requirements.
Explanation:
Decrease logistics support requirements is the correct answer because the increase in reliability decreases the requirement to correct the commodity or equipment. Therefore, the logistic support decreases which further decreases the manpower waste. Additionally, the good reliability shows that the product's quality is good and it will work efficiently for a longer time period. Thus, a good quality product requires less logistic support.
Reliability is a quality of being trustworthy and in performing constantly well. It result in measurement and calculations and tends to be more accurate.
Thus there is a decrease in logistics support requirements. When the system function before it breaks. Good reliability will always support the system.Hence the option A is correct.
Learn more about the or system will perform its function before.
brainly.com/question/14312571.
If repossessed collateral is sold or otherwise disposed of by the creditor, then the time, place, manner, and method of disposal must be a. court ordered. b. scheduled with the debtor so that the debtor is able to attend. c. perfected. d. commercially reasonable.
Answer:
d. commercially reasonable.
Explanation:
In the case when the collateral i.e. repossessed is sold and disposed off by the creditor so the time, place and the method for selling or disposal should be commercially reasonable i.e. it can be measured in monetary terms so that everyone could aware of the price at which it is disposed off
Therefore the option d is correct
Shellhammer Company's inventory records show the following data for the month of September: Units Unit Cost Inventory, September 1 100 $3.34 Purchases: September 8 450 3.50 September 18 350 3.70 A physical inventory on September 30 shows 200 units on hand. If the company uses FIFO inventory costing and a periodic inventory system, the the value of ending inventory at the end of September is
Answer:
Ending inventory $740
Cost of goods sold $2,464
Explanation:
Calculation to determine the value of ending inventory and cost of goods sold if the company uses FIFO inventory costing and a periodicinventory system.
Calculation for the value of ending inventory
Ending inventory of 200 units= 200 x $3.70
Ending inventory of 200 units = $740
Calculation for Cost of goods sold:
Units available for sale= (100 + 450 + 350) = 900
Units sold= 900 – 200 = 700
100 × $3.34 = $ 334
450 × $3.50 =$1,575
150 × $3.70 =$555
Cost of goods sold $2,464
($ 334+$1,575+$555)
Therefore the value of ending inventory is $740 and cost of goods sold if the company uses FIFO inventory costing and a periodicinventory system will be $2,464
Highest and best use would best be defined as:
Answer:
The reasonable, probable and legal use of vacant land or an improved property, which is physically possible, appropriately supported, financially feasible, and that results in the highest value.
Explanation:
Mandatory outlays a. require changes in existing laws if those outlays are to be altered. b. cannot be altered once they are made into law. c. usually change during the budget process. d. are a minor component of total outlays, and so are usually ignored.
Answer:
a. require changes in existing laws if those outlays are to be altered.
Explanation:
The mandatory outlays are the outlays in which there should be the need to change in the law i.e. already existed but the same is applied when the outlays could be changed or varied or altered
That means without alteration it does not required the changes
Therefore the option a is correct
Anya owns land with an adjusted basis of $305,000, subject to a mortgage of $175,000. Anya sells her land subject to the mortgage for $325,000 in cash, and a note for $300,000. What is Anya's amount realized on this sale
Answer: $800,000
Explanation:
Alice's realized amount from the sale is a sum of all the amounts that the seller gets it for as well as any mortgages assumed.
Alice therefore realized:
= Mortgage assumed by seller + Cash + Note
= 175,000 + 325,000 + 300,000
= $800,000
In a sandwich shop, 3 workers are able to make 45 sandwiches in an hour during the lunch rush. When a 4th worker is added, the team is able to make 57 sandwiches. Calculate the marginal product of adding the 4th worker.
Answer:
12
Explanation:
Calculation to determine the marginal product of adding the 4th worker
Using this formula
MP=ΔTPΔL
Let plug in the formula
ΔTP=57−45
ΔTP=12
Therefore The marginal product of adding the 4th worker is 12 sandwiches.
Exhibit 15-8 The following estimated regression model was developed relating yearly income (y in $1000s) of 30 individuals with their age (x1) and their gender (x2) (0 if male and 1 if female). ŷ = 30 + 0.7x1 + 3x2 Also provided are SST = 1200 and SSE = 384. The yearly income of a 24-year-old female individual is _____. a. $49.80 b. $19,800 c. $19.80 d. $49,800
Answer:
d. $49,800
Explanation:
The yearly income of a 24 year old female is $49,800. Relationship between SST and SSE is defined as SST - SSE.
The equation describes the relationship between two variables that these variables are independent.
The controller of Oriole Industries has collected the following monthly expense data for use in analyzing the cost behavior of maintenance costs.
Month Total Total
Maintenance Costs Machine Hours
January $2,860 320
February 3,160 370
March 3,760 520
April 4,660 670
May 3,360 520
June 5,260 720
Determine the variable cost components using the high-low method. (Round answer to 2 decimal places e.g. 2.25.)
Variable cost per machine hour $
Determine the fixed cost components using the high-low method.
Total fixed costs $
Answer:
Results are below.
Explanation:
Giving the following information:
Maintenance Costs Machine Hours
January $2,860 320
February 3,160 370
March 3,760 520
April 4,660 670
May 3,360 520
June 5,260 720
To calculate the variable and fixed costs, we need to use the following formulas:
Variable cost per unit= (Highest activity cost - Lowest activity cost)/ (Highest activity units - Lowest activity units)
Variable cost per unit= (5,260 - 2,860) / (720 - 320)
Variable cost per unit= $6
Fixed costs= Highest activity cost - (Variable cost per unit * HAU)
Fixed costs= 5,260 - (6*720)
Fixed costs= $940
Fixed costs= LAC - (Variable cost per unit* LAU)
Fixed costs= 2,860 - (6*320)
Fixed costs= $940
If a company sells its smart phones for $400 and the phones have a COGS of $250, how many additional phones would the company have to sell if it decided to spend an extra $150,000 on advertising to promote the phones
Answer:
Units to be sold= 1,000
Explanation:
Giving the following information:
Selling price= $400
COGS= $250
Increase in costs= $150,000
To calculate the number of units to be sold to cover the incremental costs, we need to use the following formula:
Units to be sold= increase in costs/ contribution margin per unit
Units to be sold= 150,000 / (400 - 250)
Units to be sold= 1,000
A firm is considering a project requiring an investment of $30,000. The project would generate an annual cash flow of $7,251 for the next six years. The company uses the straight-line method of depreciation with no mid-year convention. Ignore income taxes. The approximate internal rate of return for the project is: __________
a.11%.
b.10%.
c.12%.
d.9%.
Answer:
c.12%
Explanation:
PVF of 12% for 6 years is 4.11
PVFof 11% for 6 years is 4.23
Present value of cash inflows, 12% = 7251*4.11
Present value of cash inflows, 12% = 29801.61
Present value of cash inflows, 11% = 7251*4.23
Present value of cash inflows, 11% = 30671.73
Internal rate of return = 11% + (30671.73 - 30000)/(30671.73-29801.61)
Internal rate of return = 11.7719969659%
Internal rate of return = 11.772%
When a company outsources some of its work / activities currently done by itself, it ultimately shifts the cost structure of the company. In most cases this shift entails:
Answer:
Outsourcing Company Activities
The shift in the cost structure of the company entails:
the elimination of most fixed costs and making variable costs to become more prominent.
Explanation:
A company's cost structure describes the relative proportions of fixed and variable costs which the company incurs in its business activities. Outsourcing is a cost-driven strategy that involves the use of outside vendors to perform services and create goods that were traditionally produced in-house, thereby eliminating some employees and facilities, and thus, reducing cost.
If IBM has a beta of 1.2 when the risk-free rate is 6% and the expected return on the market portfolio is 18%, the expected return on IBM is:
Answer:
20.4%
Explanation:
Calculation to determine what the expected return on IBM is:
Using this formula
E(Ribm)=Risk-free rate+(Market portfolio -Risk-free rate) Beta
Let plug in the formula
E(Ribm) = 6% +(18%-6%)1.2
E(Ribm)=6%+12%(1.2)
E(Ribm)=6%+14.4%
E(Ribm)=20.4%
Therefore the expected return on IBM is:20.4%
A(n)______ variance occurs when management pays an amount different from the standard price to acquire the item.
Answer:
The answer is "Spending".
Explanation:
A(n) variance in spending happens whenever management spends a quantity other than the standard cost of the products to be acquired.
The difference in expenditure is the gap between the real level as well as the expected amount (or budget) of spending. Overhead costs often include fixed costs, e.g. operating expenses.
ng 40\%; \$4.400 A company is considering the purchase of a new machine for $ 63,000 . Management predicts that the machine can produce sales of $ 17,500 each year for the next 10 years . Expenses are expected to include direct materials , direct labor , and factory overhead totaling 6,500 per year including depreciation of per year . Income tax expense is per year based on a tax rate of What the payback period for the new machine
Answer:
3 years and 8 months
Explanation:
The payback period is the length of time that it takes for the cashflow of a project to equal the initial investment of the project.
Initial investment = $ 63,000
Cash flow :
Sales $ 17,500
Less Expenses ($6,500)
Add Depreciation ($ 63,000 ÷ 10) $6,300
Annual Cash flow $17,300
thus,
It takes 3 years and 8 months ($11,100/$17,300 x 12) for the cashflow of a project to equal the initial investment for the new machine.
Since its establishment on January 1, 1999, the euro has more than tripled in appreciation against the U.S. dollar, reaffirming the ability of the European Central Bank to manage monetary policy within the euro zone.
A. True
B. False
Answer:
B. False
Explanation:
The exchange rate between the euro and the dollar was 1.1719 dollars per 1 euro. Currently, the exchange rate is 1.18 dollars per euro. The euro has appreciated slightly against the US dollar, but it is a small percentage. It is not even close to multiplying its value by 3.
ABC Industries is a division of a major corporation. Data concerning the most recent year appears below:
Sales $18,080,000
Net operating income $940,160
Average operating assets $4,810,000
The division's return on investment (ROI) is closest to:____.
a. 5.60%.b. 20.56%.c. 16.71%.d. 2.60%.
Answer:
the return on investment is 19.55%
Explanation:
The computation of the return on investment is shown below:
Return on investment is
= (Net operating income ÷ Average operating assets) × 100
= ($940,160 ÷ 4,810,000) × 100
= 19.55%
Hence, the return on investment is 19.55%
Klean Fiber Company is the creator of Y-Go, a technology that weaves silver into its fabrics to kill bacteria and odor on clothing while managing heat. Y-Go has become very popular in undergarments for sports activities. Operating at capacity, the company can produce 1,053,000 Y-Go undergarments a year. The per unit and the total costs for an individual garment when the company operates at full capacity are as follows.
Per Undergarment Total
Direct materials $1.96 $2,063,880
Direct labor 0.47 494,910
Variable manufacturing overhead 0.98 1,031,940
Fixed manufacturing overhead 1.41 1,484,730
Variable selling expenses 0.38 400,140
Totals $5.20 $5,475,600
The U.S. Army has approached Klean Fiber and expressed an interest in purchasing 249,700 Y-Go undergarments for soldiers in extremely warm climates. The Army would pay the unit cost for direct materials, direct labor, and variable manufacturing overhead costs. In addition, the Army has agreed to pay an additional $1.01 per undergarment to cover all other costs and provide a profit. Presently, Klean Fiber is operating at 70% capacity and does not have any other potential buyers for Y-Go. If Klean Fiber accepts the Army’s offer, it will not incur any variable selling expenses related to this order.
Required:
Prepare an incremental analysis for the Klean Fiber.
Answer:
Klean Fiber Company
Incremental Analysis for the
Special order by the U.S. Army:
Units to be purchased = 249,700
Sales Revenue $4.42
Variable costs:
Direct materials $1.96
Direct labor 0.47
Variable manufacturing overhead 0.98
Total variable costs 3.41
Additional for contribution margin 1.01
Contribution margin = $252,197 ($1.01 * 249,700)
Explanation:
a) Data and Calculations:
Annual production capacity = 1,053,000
Per Undergarment Total
Direct materials $1.96 $2,063,880
Direct labor 0.47 494,910
Variable manufacturing overhead 0.98 1,031,940
Fixed manufacturing overhead 1.41 1,484,730
Variable selling expenses 0.38 400,140
Totals $5.20 $5,475,600
In a perpetual inventory system a.a count must be made in order to know the inventory amount. b.the inventory records cannot be computerized. c.the amount of inventory for sale and the amount sold are not listed in the inventory account. d.each purchase and sale of inventory is recorded in the inventory account.
Answer:
d. each purchase and sale of inventory is recorded in the inventory account.
Explanation:
The perpetual inventory system keeps record of inventory and cost of sales after each and every transaction. Its records are always updated after every purchase or sale transaction thus, In a perpetual inventory system : each purchase and sale of inventory is recorded in the inventory account.
A 22-year old college student has been promised a $1 million check at this 50thbirthday (28years from today). What is the present value of the $1 million today assuming an interest rate of 5%
Answer:
$255,093.64
Explanation:
Calculation to determine the present value of $1 million today
Using Financial calculator
PV = PV (rate, nper, pmt, fv, type)
Where,
FV = $1,000,000
Annual Interest rate = 5%
Number of periods = 28
Let plug in the formula
PV = PV (5%, 28, 0, -1000000, 0)
PV= $255093.64
Therefore the Present value of $1 million today is $255,093.64
Crazy Mountain Outfitters Co., an outfitter store for fishing treks, prepared the following unadjusted trial balance at the end of its first year of operations:
Crazy Mountain Outfitters Co.
Unadjusted Trial Balance
April 30, 2018
Debit
Balances Credit
Balances
Cash 11,400
Accounts Receivable 72,600
Supplies 7,200
Equipment 112,000
Accounts Payable 12,200
Unearned Fees 19,200
Common Stock 20,000
Retained Earnings 117,800
Dividends 10,000
Fees Earned 305,800
Wages Expense 157,800
Rent Expense 55,000
Utilities Expense 42,000
Miscellaneous Expense 7,000
475,000 475,000
For preparing the adjusting entries, the following data were assembled:
Required:
Supplies on hand on April 30 were $1,380.
Fees earned but unbilled on April 30 were $3,900.
Depreciation of equipment was estimated to be $3,000 for the year.
Unpaid wages accrued on April 30 were $2,475.
The balance in unearned fees represented the April 1 receipt in advance for services to be provided. Only $14,140 of the services was provided between April 1 and April 30.
2. Determine the revenues, expenses, and net income of Crazy Mountain Outfitters Co. before the adjusting entries.
Revenues $
Expenses
Net income $
3. Determine the revenues, expenses, and net income of Crazy Mountain Outfitters Co. after the adjusting entries.
Revenues $
Expenses
Net income $
4. Determine the effect of the adjusting entries on Retained Earnings.
Retained Earnings increases by $.
Answer:
1. Dr Supplies expense $5,820
Cr Supplies $5,820
Dr Accounts receivable $3,900
Cr Earned fees $3,900
Dr Depreciation expense $3,000
Cr Accumulated depreciation $3,000
Dr Wages expense $2,475
Cr Wages payable $2,475
Dr Unearned fees $14,140
Cr Fees earned $14,140
2. Revenues $305,800
Expenses $261,800
Net income $44,000
3. Revenue $323,840
Expense $261,800
Net income $50,745
4. $6,745 Increase
Explanation:
1. Preparation of the journal entries necessary on April 30. 2019
Dr Supplies expense $5,820
Cr Supplies $5,820
($7,200-$1,380)
(To record supplies used)
Dr Accounts receivable $3,900
Cr Earned fees $3,900
(To record accrued fees Earned)
Dr Depreciation expense $3,000
Cr Accumulated depreciation $3,000
(To record equipment Depreciation)
Dr Wages expense $2,475
Cr Wages payable $2,475
(To record accrued wages)
Dr Unearned fees $14,140
Cr Fees earned $14,140
(To record fees earned)
2. Calculation to Determine the revenues, expenses, and net income of Crazy Mountain Outfitters before the adjusting entries.
REVENUE
Fees earned $305,800
EXPENSE:
Wages Expense $157,800
Rent Expense $55,000
Utilities Expense $42,000
Miscellaneous Expense $7,000
Expense $261,800
NET INCOME $44,000
($305,800-$261,800)
Therefore the revenues, expenses, and net income of Crazy Mountain Outfitters before the adjusting entries will be:
Revenues $305,800
Expenses $261,800
Net income $44,000
3. Calculation to Determine the revenues, expenses, and net income of Crazy Mountain Outfitters Co. after the adjusting entries.
REVENUE
Fees Earned $305,800
Fees earned but unbilled $3,900
Unearned fees $14,140
Revenue $323,840
EXPENSE
Wages Expense $157,800
Rent Expense $55,000
Utilities Expense $42,000
Miscellaneous Expense $7,000
Supplies expense $5,820
Depreciation of equipment $3,000
Unpaid wages accrued $2,475
Expense $273,095
NET INCOME $50,745
($323,840-$273,095)
Therefore the revenues, expenses, and net income of Crazy Mountain Outfitters Co. after the adjusting entries will be:
Revenue $323,840
Expense $261,800
Net income $50,,745
4. Calculation to Determine the effect of the adjusting entries on Retained Earnings.
Effect of the adjusting entries=$50,745-$44,000
Effect of the adjusting entries=$6,745
Therefore the effect of the adjusting entries on Retained Earnings is Retained Earnings increases by $6,745
The increase or decrease in owner's equity is reported on the
O A income statement.
B statement of owner's equity.
C balance sheet.
D All of the above
Accounting
Answer:
B
Explanation:
Owners equity also known as the Statement of Changes in Owner's Equity is an example of a financial statement. It records the owners equity and changes to the owners equity during a financial year.
A balance sheet is a financial statement that reports a company's assets, liabilities and shareholders' equity at a point in time.
The income statement records a company's income and expenses in a financial year. It is used for determining if a company is earning a profit or a loss
Please helpppppppp (sorry Need to get the word limit in)
Answer:
i guess c By creating multilateral trade agreement . i am not sure if its correct or not .
Please write out, step-by-step, how you obtained the correct answer for this math problem.
Jose and Zola want to purchase their first home. Jose makes $23.50 an hour and works 40 hours per week. Zola makes $21.50 an hour and works 40 hours of regular time and 5 hours of overtime a week. They have two car payments totaling $500 a month and one credit card with a minimum payment of $50 a month. What is their combined gross monthly income?
(HINT: Remember to assume that overtime is always time and a half unless otherwise specified!!)
Answer:
The correct answer is "$7,630".
Explanation:
Assuming there are four weeks in a month, then
Joe's income will be:
= [tex]23.50\times 40\times 4[/tex]
= [tex]3,760[/tex] ($)
Zola's income will be:
= [tex]21.50\times (40+5)\times 4[/tex]
= [tex]21.50\times 45\times 4[/tex]
= [tex]3,870[/tex] ($)
hence,
The combined gross monthly income will be:
= [tex]Jose's \ income+Zola's \ income[/tex]
= [tex]3,760+3,870[/tex]
= [tex]7,630[/tex] ($)
Answer:
$8,498.75
Explanation:
Jose = ($23.5x40x52)/12=$4073.33
Zola = ($21.5x40x52/12)+($21.5x1.5(overtime pay)x5x52)/12= $3726.67+$698.75=$4425.41
Combined = $4073.33+ $4425.42= $8498.75
$ 485,000 $ 432,000 $Enter a dollar amount Enter percentages rounded to 0 decimal places % Inventory $ 786,000 $ 617,000 $Enter a dollar amount Enter percentages rounded to 0 decimal places % Total assets $3,111,000 $2,707,000 $Enter a dollar amount Enter percentages rounded to 0 decimal places %
Answer:
Accounts receivable
Dec 31, 2017 = $485,000
Dec 31, 2016 = $432,000
Amount = $53,000
Percentage = $53,000/$432,000
Percentage = 0.1226852
Percentage = 12%
Inventory
Dec 31, 2017 = $786,000
Dec 31, 2016 = $617,000
Amount = $169,000
Percentage = $169,000 / $617,000
Percentage = 0.2739060
Percentage = 27%
Total assets
Dec 31, 2017 = $3,111,000
Dec 31, 2016 = $2,707,000
Amount = $404,000
Percentage = $404,000/$2,707,000
Percentage = 0.1492427
Percentage = 15%
Bella Bags is a British company that sells luxury leather purses manufactured in London. Currently, its products are carried at high-end department stores all across Europe. The company prides itself on its exceptional customer service. However, the company has been criticized in the past for carrying only two designs of bags. There is currently growing market demand for high-end luxury accessories. Bella Bags faces fierce competition from established luxury brands. Which of the following best characterizes an actionable strategy for Bella Bags that works on reducing the company's weaknesses to avoid threats?
A) Reduce the threat of high competition by expanding the product line and offering more variety
B) Promote the company's exceptional customer service to leverage the increasing demand for luxury goods
C) Reduce the threat of high competition by promoting the company's narrow product offering
D) Reduce the threat of high competition by leveraging the increasing demand for luxury goods
Answer:
A
Explanation:
Two athletes of equal ability are competing for a prize of $10,000. Each is deciding whether to take a dangerous performance-enhancing drug. If one athlete takes the drug, and the other does not, the one who takes the drug wins the prize. If both or neither take the drug, they tie and split the prize. Taking the drug imposes health risks that are equivalent to a loss of X dollars
Required:
a. Draw a $2 payoff matrix describing the decisions the athletes face.
b. For what X is taking the drug the Nash equilibrium?
c. Does making the drug safer (that is, lowering X) make the athletes better or worse off? Explain.
Answer:
a) attached below.
b) for $x < $5000 will cause taking the drug to be part of the Nash equilibrium
c) will make the athletes feel better because the value their payoff will increase
Explanation:
a) 2 * 2 payoff matrix describing the decision faced by the athletes
attached below
when both players take the drug the payoff for each player = $5000 - x
when neither player takes the drug the payoff for each player = $5000
When only one player takes the drug his payoff = $10000 - x
b) If we consider the value of $x to be involved in the Nash equilibrium then
; $5000 - $x > 0 becomes the best response
hence for $x < $5000 will cause taking the drug to be part of the Nash equilibrium
c) Lowering the negative effect of the drug ( i.e. when the value of x is reduced )
will make the athletes feel better because the value their payoff will increase
Cyclical unemployment arises when:______.
a. the agriculture sector completes the cycle of planting, cultivating, and harvesting the nation's food supply.
b. labor unions strike for higher wages.
c. the business cycle enters an expansionary phase.
d. business activity in the macroeconomy declines.
Answer:
D
Explanation:
types of unemployment
structural unemployment is an unemployment that occurs as a result of changes in the economy. These changes can be as a result of changes in technology, polices or competition. Structural unemployment tends to be permanent.
The geologist lost his hob permanently due to increase in wages (polices)
Frictional unemployment: the period of time a person is unemployed from the period he leaves his current job and the time he gets another job. Eg. when a real estate agent who leaves a job in Texas and searches for a similar, higher-paying job in California.
Voluntary unemployment: e.g. worker at a fast-food restaurant who quits work and attends college.
Cyclical unemployment: it occurs as a result of fluctuations in the economy. Unemployment would be high in a downturn and low in a boom
Actual indirect materials costs$11,800 $6,700 Actual indirect labor costs 55,600 45,900 Other overhead costs 16,000 49,900 Overhead applied 91,400 96,700 Storm Concert Promotions Determine whether overhead is overapplied or underapplied. Prepare the journal entry to allocate (close) overapplied or underapplied overhead to Cost of Goods Sold. Valle Home Builders Determine whether overhead is overapplied or underapplied. Prepare the journal entry to allocate (close) overapplied or underapplied overhead to Cost of Goods Sold.
Answer:
See below
Explanation:
1. Actual costs = $11,800(indirect material + $55,600(indirect labor) + $16,000(other overhead costs) = $83,400(actual cost)
$91,400(overhead applied) - $83,400(actual cost) = Overhead applied is greater than the actual cost which means that overhead was over applied by $8,000
2. Debit: Manufacturing overhead $8,000
______ Credit: Cost of goods sold $8,000
3. Actual costs = $6,700(indirect material) + $45,900(indirect labor) + $49,900(other overhead costs) = $102,500
$96,700(overhead applied) - $102,000(actual costs) = Overhead applied is less than the actual costs which means that overhead was under applied by $5,800
4. Debit : Cost of goods sold $5,800
_______ Credit: Manufacturing overhead $5,800
A local electricity-generating company has a monopoly that is protected by an entry barrier that takes the form of A) control of a key raw material.
Answer:
economies of scale
Explanation:
Here are the options
control of a key raw material
a perfectly inelastic demand curve
legal monopoly
economies of scale
A monopoly is when there is only one firm operating in an industry. there are usually high barriers to entry of firms. the demand curve is downward sloping. it sets the price for its goods and services.
An example of a monopoly is a utility company
A natural monopoly occurs due to the high start-up costs or a large economies of scale.
Natural monopolies are usually the only company providing a service in a particular region
Characteristics of natural monopolies
1. they have a large fixed cost
2. The firms have a low marginal cost
3. They occur naturally through the free market. It does not occur by government regulation or any other force
For local electricity-generating companies, as output increases, cost per unit falls. This is known as economies of scale