The aggregate consumption function can shift because of changes in expected disposable income and in the marginal propensity to consume.
The marginal propensity to consume (MPC) is the proportion of each additional dollar of income that households spend on consumption. If the MPC increases, then the aggregate consumption function will shift upward, as households are more willing to spend a larger proportion of their income on consumption.
Expected disposable income refers to the amount of income that households expect to have after taxes and other deductions. If expected disposable income increases, then the aggregate consumption function will shift upward, as households will have more money to spend on consumption.
The aggregate consumption function can be affected by changes in the marginal propensity to save (MPS) and aggregate wealth. An increase in the MPS will shift the aggregate consumption function downward, as households are saving more and spending less.
An increase in aggregate wealth, such as through higher stock prices or real estate values, can increase household wealth and lead to an upward shift in the aggregate consumption function, as households feel more confident in their ability to spend.
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To include the personal assets and transactions of a business's owner in the records and reports of the business would be in conflict with the: Multiple Choice Objectivity principle.
To include the personal assets and transactions of a business's owner in the records and reports of the business would be in conflict with the: Objectivity principle.
What's objectivity principleThe objectivity principle is one of the fundamental accounting principles that require financial statements and reports to be free from bias, errors, and personal opinions.
Including personal assets and transactions of a business owner in the records and reports of the business would violate this principle as it would introduce a significant amount of subjectivity and personal bias into the financial records of the company.
This could lead to inaccurate reporting, which could affect the decisions of stakeholders such as investors, lenders, and other interested parties.
To maintain objectivity in accounting records and reports, it is crucial to keep personal assets and transactions of the business owner separate from those of the business.
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If wheat costs four dollars per bushel in the United States and two British pounds per bushel in Great Britain, then in the presence of purchasing-power parity the exchange rate should be
In the presence of purchasing-power parity, the exchange rate between the United States and Great Britain should be such that the cost of one US dollar in British pounds is equal to the ratio of the price of wheat in the US to the price of wheat in Great Britain. Therefore, the exchange rate should be:
1 US dollar = (4 US dollars per bushel of wheat) / (2 British pounds per bushel of wheat) = 2 British pounds per US dollar.
The exchange rate in the presence of purchasing-power parity (PPP) when wheat costs four dollars per bushel in the United States and two British pounds per bushel in Great Britain, we will follow these steps:
1. Identify the prices of wheat in both countries: $4/bushel in the United States and £2/bushel in Great Britain.
2. Apply the PPP formula: Exchange Rate (dollars/pound) = Price in the United States (dollars) / Price in Great Britain (pounds).
Now, we can calculate the exchange rate:
Exchange Rate (dollars/pound) = $4/bushel / £2/bushel
Exchange Rate (dollars/pound) = 2 dollars/pound
So, in the presence of purchasing-power parity, the exchange rate should be 2 dollars per British pound.
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In the personal-computer industry, increasing output drives up demand for computer parts. Suppliers of these parts respond by increasing production, and economies of scale eventually drive down the prices of the parts they produce, lowering the average cost of production for computer manufacturers. This is an example of a ____-cost industry.
This is an example of a decreasing-cost industry. In a decreasing-cost industry, increasing output leads to a decrease in the average cost of production due to economies of scale.
As the suppliers of computer parts increase production to meet the demand from computer manufacturers, they are able to spread their fixed costs over a larger output, leading to lower average costs. As a result, computer manufacturers are able to purchase the parts at a lower cost, which allows them to lower the prices of their computers, further increasing demand for their products.
In contrast, in an increasing-cost industry, increasing output leads to an increase in the average cost of production due to diseconomies of scale. This can happen when a company is operating at full capacity, and additional output requires additional resources that are less efficient than the resources already in use.
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Sheridan Company buys land for $159000 in 2021. As of 3/31/22, the land has appreciated in value to $165200. On 12/31/22, the land has an appraised value of $168400. By what amount should the Land account be increased in 2022
To determine the amount by which the Land account should be increased in 2022, we need to take into account the two different appraised values of the land during the year. From 3/31/22 to 12/31/22, the land appreciated in value by $3,200 ($168,400 - $165,200). Therefore, the Land account should be increased by $3,200 in 2022.
However, it's worth noting that the Land account should not be increased by the full appraised value of the land. Appraised value is not the same as market value, and the Land account should be adjusted to reflect the actual market value of the land. If Sheridan Company were to sell the land, they would likely not receive the full appraised value due to factors such as market demand and supply.
In summary, the Land account should be increased by $3,200 in 2022 to reflect the appreciation in value from 3/31/22 to 12/31/22. However, it's important to keep in mind that appraised value may not necessarily be the same as market value.
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Texas Instruments has $15 million of outstanding equity and $6 million of bank debt. The bank debt costs 5% per year. The estimated equity beta is 2. If the market risk premium is 5.1% and the risk-free rate is 3%, compute the weighted average cost of capital if the firmʹs tax rate is 30%. (Answer in percent: For 0.05324 answer, 5.324)
The weighted average cost of capital for Texas Instruments is approximately 10.426%.
First, let's compute the proportions of equity and debt in the firm's capital structure. The total capital is $15 million (equity) + $6 million (debt) = $21 million. The proportions are as follows:
- Equity proportion: $15 million / $21 million = 0.7143
- Debt proportion: $6 million / $21 million = 0.2857
Next, we'll calculate the cost of equity and the after-tax cost of debt:
- Cost of equity: Risk-free rate + (Equity beta * Market risk premium) = 3% + (2 * 5.1%) = 13.2%
- Cost of debt (before-tax): 5%
- After-tax cost of debt: Cost of debt * (1 - Tax rate) = 5% * (1 - 0.3) = 3.5%
Finally, we can compute the WACC by multiplying the proportions by their respective costs and summing the results:
- WACC: (Equity proportion * Cost of equity) + (Debt proportion * After-tax cost of debt) = (0.7143 * 13.2%) + (0.2857 * 3.5%) ≈ 9.4257% + 1.0000% = 10.4257%
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You plan to deposit $300 at the end of every year for 12 years starting at the end of year 1. Then after leaving the money in the account for several years, you plan to withdraw everything 15 years from today. How much is available to withdraw at the end of year 15 if the account pays 8% interest annually
At the end of year 15, there will be approximately $6,774.78 available to withdraw from the account, considering the 8% annual interest rate.
To determine the total amount available for withdrawal at the end of year 15, we need to calculate the future value of the series of $300 annual deposits and the interest earned over the entire period. We can use the future value of an ordinary annuity formula and compound interest formula for this purpose.
The future value of an ordinary annuity formula is:
FV = P * [(1 + r)^t - 1] / r
Where FV is the future value, P is the annual deposit, r is the annual interest rate, and t is the number of years.
In this case, P = $300, r = 0.08, and t = 12 years.
FV = 300 * [(1 + 0.08)^12 - 1] / 0.08
FV ≈ $5,334.98
At the end of year 12, the account will have approximately $5,334.98. Now, we need to calculate how much interest will be earned during the additional 3 years (years 13, 14, and 15).
The compound interest formula is:
FV = P * (1 + r)^t
In this case, P = $5,334.98, r = 0.08, and t = 3 years.
FV = 5334.98 * (1 + 0.08)^3
FV ≈ $6,774.78
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Which regrouping activity would be beneficial in an agricultural market that consists of many small producers
In an agricultural market that consists of many small producers, a regrouping activity that would be beneficial is the formation of cooperatives.
Cooperatives are organizations owned and controlled by the members who use their services or buy their products. In the context of agriculture, cooperatives can help small farmers and producers to pool their resources, share costs, and access markets that might otherwise be out of reach for individual producers.
By joining forces in a cooperative, small producers can benefit from economies of scale, such as lower input costs and higher bargaining power with buyers. Cooperatives can also provide services to members, such as training, marketing, and access to credit.
In addition to economic benefits, cooperatives can also foster social cohesion and community development. By working together and sharing resources, members can build relationships of trust and mutual support, and contribute to the development of their local communities.
Overall, the formation of cooperatives can be a powerful way for small agricultural producers to overcome the challenges of operating in a fragmented and competitive market, and to improve their economic and social well-being.
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Trademarks, trade names, patents, and copyrights represent a category of property called: Group of answer choices real property personal property tangible property statutory property none of the other choices
An asset class known as intellectual property includes trademarks, trade names, patents, and copyrights. none of the alternative options. Option 5 is Correct.
Intellectual property comes in many different forms, including trademarks, patents, and copyrights. Inventions, literary and creative works, designs, and symbols, names, and pictures used in business are all examples of intellectual property (IP). New ideas, procedures, or scientific discoveries are protected by patents; brands, logos, and catchphrases are protected by trademarks; and unique literary works are protected by copyrights.
Any term, phrase, symbol, design, or combination of these that distinguishes your products or services might be considered a trademark. Customers use it to recognise you in the marketplace and set you apart from your rivals. The terms "trademark" and "service mark" are interchangeable. Option 5 is Correct.
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Correct Question:
Trademarks, trade names, patents, and copyrights represent a category of property called: Group of answer choices
1. real property
2. personal property
3. tangible property
4. statutory property
5. none of the other choices
(Price Leadership) Why might a price-leadership model of oligopoly not be an effective means of collusion in an oligopoly
A price-leadership model of oligopoly is when one firm in the industry sets the price and the other firms follow.
The leader sets a price that maximizes its own profit, but also takes into account the reaction of its competitors. The other firms then follow the leader's price, which can create a stable price for the industry.
However, a price-leadership model of oligopoly may not be an effective means of collusion in an oligopoly for several reasons.
First, the leader may not have complete information about the costs and demand conditions of its competitors. This could result in the leader setting a price that is too high or too low, which could lead to the other firms either undercutting the leader or not following the leader's price.
Second, the other firms may not be willing to follow the leader's price. They may have different cost structures or may be more focused on gaining market share than maximizing short-term profits. This could lead to price wars or undercutting, which would result in lower profits for all firms in the industry.
Third, antitrust laws and regulations may prevent collusion between firms. Price leadership could be seen as an attempt to fix prices, which is illegal in many countries. Therefore, the leader may face legal action if it is seen as colluding with its competitors.
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A microwave oven costs $124.85 before it is marked down. If it is marked down by 63%, what is its new price, to the nearest cent
Answer $46.19.
To find the new price of the microwave oven after a 63% markdown, you'll need to calculate the discount amount and then subtract it from the original price.
Original price: $124.85
Discount: 63%
First, calculate the discount amount by multiplying the original price by the discount percentage:
Discount amount = $124.85 * 0.63 = $78.6555
Next, subtract the discount amount from the original price to find the new price:
New price = $124.85 - $78.6555 ≈ $46.19
So, the new price of the microwave oven after the 63% markdown is approximately $46.19.
The term "discount" can have different meanings depending on the context. Generally, a discount refers to a reduction in price from the original or regular price of a product or service.
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Just-in-time relies on ___________ worker skills, meaning the ability of workers to perform many different tasks on many different machines.
Just-in-time relies on cross-functional worker skills, meaning the ability of workers to perform many different tasks on many different machines. Cross-functional skills enable employees to be versatile and adapt to various roles, contributing to the efficiency and flexibility of the just-in-time production process.
Just-in-time relies on cross-functional worker skills, meaning the ability of workers to perform many different tasks on many different machines. This is because in a just-in-time manufacturing process, the goal is to minimize waste and improve efficiency by producing only what is needed, when it is needed. This requires workers who are able to adapt and work in different areas of the production process, rather than being limited to a specific task or machine. Cross-functional skills are essential for success in a just-in-time system.
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All of the following are potential problems with line-and-staff organizations except ______. Multiple choice question. overstaffing ambiguous lines of communication duplication of work employee frustration over lack of authority
Employee frustration over a lack of authority is not a potential problem with line-and-staff organizations. However, overstaffing, ambiguous lines of communication, and duplication of work are all potential problems that can arise in this type of organizational structure. The correct option is employee frustration over lack of authority.
Line-and-staff organizations are structured in a way that creates two types of roles - line and staff. Line roles are responsible for the primary functions of the organization, such as production or sales, while staff roles support these functions. The staff roles provide specialized knowledge and expertise, but they do not have the authority to make decisions.
Therefore, staff roles may not feel frustrated over a lack of authority because it is not within the scope of their job. However, the other options listed in the multiple-choice question are potential problems with line-and-staff organizations. Overstaffing can lead to increased costs and reduced efficiency. Ambiguous lines of communication can cause confusion and mistakes. Duplication of work can lead to wasted time and resources. All of these issues can negatively impact the overall effectiveness of the organization. The correct option is employee frustration over lack of authority.
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Megan Mei is charged 2 points on a $120,000 loan at the time of closing. The original price of the home before the down payment was $140,000. The points in dollars cost Megan: Multiple Choice $2,800 $240 $2,400 $280
The points in dollars cost Megan $2,400. The correct answer among the multiple-choice options is $2,400.
Megan Mei is charged 2 points on a $120,000 loan at the time of closing. To calculate the cost of the points in dollars, we need to convert the points into a percentage and apply it to the loan amount.
1 point is equivalent to 1% of the loan amount. Since Megan is charged 2 points, this is equal to 2% of the loan amount. Now, we will apply this percentage to the loan amount:
Cost of points = 2% of $120,000
Cost of points = 0.02 × $120,000
Cost of points = $2,400
Therefore, the points in dollars cost Megan $2,400. The correct answer among the multiple-choice options is $2,400.
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You are the project manager for a software product and your project is in the execution stage. You have learned that Maya, a developer, has started adding some new features to the deliverable she was working on. What is the best action for you to take
As a project manager, it is important to ensure that the project stays on track and meets the agreed upon requirements. If a developer, like Maya, starts adding new features to the deliverable without consulting the project team, this can cause delays and impact the project's success.
Therefore, the best action for me to take would be to speak with Maya and understand why she felt the need to add the new features. It is possible that these features were already agreed upon or necessary for the success of the project. If this is the case, I would work with Maya to ensure that the changes are properly documented and communicated to the rest of the team.
However, if the new features were not approved or necessary for the project, I would need to explain the impact they could have on the timeline and budget. I would work with Maya to find a solution that meets the project's requirements while also minimizing any negative impact on the project.
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If a business is following a focused strategy, then its competitive scope is ________. Multiple Choice Broad market Narrow market Broad range products Broad range of services
If a business is following a focused strategy, then its competitive scope is narrow market.
A focused strategy is a business strategy that concentrates on serving a particular segment of the market and tailoring its products or services to meet the unique needs of that segment. This approach enables the business to differentiate itself from competitors and become a leader in a specific market niche. To implement a focused strategy, the business must define its target market clearly and develop products or services that cater to that market segment.
The competitive scope of a business refers to the range of products, services, and markets it serves. In the case of a focused strategy, the competitive scope is narrow market, which means that the business focuses on a specific customer group and offers a limited range of products or services to that group. By limiting its scope, the business can better understand its customers' needs and preferences and offer customized solutions that meet those needs. This approach can lead to higher customer satisfaction and loyalty, as well as improved profitability and competitive advantage in the long run.
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Suppose that government spending was increased by 10 units and that this increase was financed by a 10-unit increase in taxes. Would equilibrium income change or remain the same as a result of these two policy actions
If government spending increased by 10 units and that this increase was financed by a 10-unit increase in taxes, equilibrium income would change as a result of these two policy actions.
This is because the increase in government spending would inject additional funds into the economy, stimulating economic activity and increasing aggregate demand. As businesses respond to this increased demand, they may hire more workers or increase production, leading to a rise in income.
On the other hand, the 10-unit increase in taxes would reduce disposable income for households, potentially causing them to cut back on spending. However, the overall impact on equilibrium income depends on the marginal propensity to consume (MPC) – the proportion of an additional dollar of income that is spent rather than saved.
If the MPC is less than 1, the decrease in consumption resulting from the tax increase would be smaller than the increase in government spending, leading to a net increase in equilibrium income. Conversely, if the MPC is equal to 1, the tax increase would offset the government spending increase, and equilibrium income would remain the same.
In reality, the MPC is usually less than 1, so an increase in government spending coupled with an equal tax increase would likely result in a net increase in equilibrium income.
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Clementine Company makes skateboards. They prepare master and flexible budgets and then perform variance analysis after the budget plan period elapses. Their data is as follows: Budget Actual Selling price per unit $97 $106 Variable cost per unit $45 $49 Quantity sold 958 1,032 What is the Clementine's volume variance for SALES
The Clementine Company's sales volume variance is $9,288. This suggests that the company exceeded their unit sales projection, resulting in a positive variance.
To calculate the volume variance for sales, we need to compare the actual sales volume with the budgeted sales volume, assuming the budgeted selling price per unit. Budgeted revenue (based on budgeted quantity sold and budgeted selling price per unit) = $97 x 958 = $93,126 Actual revenue (based on actual quantity sold and actual selling price per unit) = $106 x 1,032 = $109,392 Budgeted revenue (based on actual quantity sold and budgeted selling price per unit) = $97 x 1,032 = $100,104
The volume variance for sales can be calculated as follows: Volume variance for sales = Actual revenue - Budgeted revenue (based on actual quantity sold and budgeted selling price per unit) Volume variance for sales = $109,392 - $100,104 Volume variance for sales = $9,288 Therefore, the volume variance for sales for Clementine Company is $9,288. This indicates that the company sold more units than budgeted, resulting in a favorable variance.
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Rosa and Jose have liquid assets of $5,000 and other assets of $50,000. Their total liabilities equal $26,000. What is their net worth
Rosa and Jose's net worth is $29,000.
Net worth is calculated by subtracting total liabilities from total assets. In this case, their liquid assets are $5,000, and their other assets are $50,000, for a total of $55,000 in assets. Their total liabilities are $26,000.
Total assets = Liquid assets + Other assets
Total assets = $5,000 + $50,000
Total assets = $55,000
Net worth = Total assets - Total liabilities
Net worth = $55,000 - $26,000
Net worth = $29,000
Thus, Rosa and Jose's net worth is $29,000. This means that their assets exceed their liabilities by $29,000. It is important to note that having a positive net worth is a good indication of financial health and stability. It also means that they have the ability to pay off their debts and still have a significant amount of assets remaining. Having a clear understanding of one's net worth is essential for making informed financial decisions and planning for the future.
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Program-length advertisements on television that take an educational approach to communication with potential customers are known as Blank______.
infomercials are program-length advertisements on television that take an educational approach to communication with potential customers. While they have been subject to criticism, when used responsibly and honestly, they can be an effective tool for companies to generate sales and reach a wider audience.
Infomercials are a type of television commercial that usually lasts 30 minutes or longer, and they are designed to provide detailed information about a particular product or service. They typically feature a host or spokesperson who demonstrates the product, explains its benefits, and provides testimonials from satisfied customers.
Infomercials are often used by companies that sell complex or high-priced products, such as exercise equipment, kitchen appliances, or investment opportunities. By providing in-depth information about the product, infomercials aim to educate potential customers about its features and benefits, and to persuade them to make a purchase.
Infomercials are sometimes criticized for being overly promotional or misleading, as they often use persuasive language and emotional appeals to sell the product. However, when used responsibly and honestly, infomercials can be an effective way for companies to reach a wider audience and generate sales.
In recent years, infomercials have evolved to include digital channels such as social media, online video platforms, and live streaming. This has enabled companies to reach audiences beyond traditional television viewership, and to tailor their messaging to specific demographics and interests.
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Dudley Hill Golf Club's market-to-book ratio is currently 1.6 times and the PE ratio is 6.30 times. If Dudley Hill Golf Club's common stock is currently selling at $13.00 per share, what is the book value per share
The book value per share of Dudley Hill Golf Club is $8.13. we need to use the market-to-book ratio and the current stock price.
To calculate the book value per share of Dudley Hill Golf Club, we need to use the market-to-book ratio and the current stock price:
Market-to-Book Ratio = Market Value per Share / Book Value per Share
1.6 = $13.00 / Book Value per Share
Book Value per Share = $13.00 / 1.6
Book Value per Share = $8.13
Now that we know the book value per share, we can use the PE ratio to find the earnings per share:
PE Ratio = Stock Price per Share / Earnings per Share
6.30 = $13.00 / Earnings per Share
Earnings per Share = $13.00 / 6.30
Earnings per Share = $2.06
Therefore, the book value per share of Dudley Hill Golf Club is $8.13.
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The grinding machines are potentially the constraint in the production facility. A total of 9,000 minutes are available per month on these machines. Direct labor is a variable cost in this company. Which product makes the MOST profitable use of the grinding machines
The number of units demanded times the number of grinding minutes per unit yields the total number of Bruce corporation minutes of grinding machine time needed to meet monthly demand for each product.
This displays the overall time needed for each product. The total grinding machine time is then calculated by adding them all together. To determine the extra minutes needed above and above the minutes available to satisfy the goods' demands, this number can be compared to the total available minutes every month, which is 53,900.
Minutes of the Grinder Duration needed to meet demand for all four products:
Total Time Product A of the Grinding Machine: 410 minutes multiplied by 4,300 demand units is 17,630 minutes.
Product B equals 5.60 minutes multiplied by 4,300 demand units, or 24,080 minutes.
Product C: 4,680 minutes multiplied by 3,300 demand units equals 15,180 minutes.
Product D = 3.70 minutes * 2,300 demand units = 8,500 minutes.
65,400.
Complete question:
The grinding machines are potentially the constraint in the production facility. A total of 9,000 minutes are available per month on these machines. Direct labor is a variable cost in this company. Which product makes the MOST profitable use of the grinding machines and corporate.
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communication travels from lower to higher ranks in the hierarchy of an organization.Multiple ChoiceGrapevineHorizontalUpwardAsynchronous
Communication that travels from lower to higher ranks in the hierarchy of an organization is referred to as upward communication. So, the correct answer is Upward.
This type of communication allows lower-level employees to communicate with higher-level employees such as managers, supervisors, or executives.
Upward communication is important because it allows employees to share their ideas, concerns, and feedback with higher-ups, providing them with valuable information about what's happening at the ground level. This information can then be used to make informed decisions, improve processes, and address any issues or concerns that may be affecting the organization.
Upward communication can take many forms, including face-to-face meetings, emails, phone calls, or even surveys. It is an essential part of effective communication in any organization and should be encouraged and supported at all levels.
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8 apple pickers at an orchard can pick 240 apples in a given hour. When a 9th apple picker is added to the group, 300 apples can be picked in an hour. Calculate the marginal product of adding the 9th apple picker.
The marginal product of adding the 9th apple picker is 60 apples per hour. The marginal product of adding the 9th apple picker can be calculated as follows:
First, we need to find the total product of eight apple pickers working together, which is 240 apples per hour.
Next, we can subtract the total product of 8 apple pickers from the total product of 9 apple pickers, which is 300 apples per hour. This gives us the additional product that the 9th apple picker is contributing:
300 apples/hour - 240 apples/hour = 60 apples/hour
Therefore, the marginal product of adding the 9th apple picker is 60 apples per hour. This means that the 9th apple picker is adding an additional 60 apples to the total output of the group.
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The largest component of aggregate demand in the U.S. economy is: multiple choice net exports.government spending.consumption.investment.
The largest component of aggregate demand in the U.S. economy is consumption. Consumption refers to the total spending by households on goods and services.
It includes spending on durable goods (such as cars and appliances), nondurable goods (such as food and clothing), and services (such as healthcare and education). Consumption makes up a significant portion of the U.S. economy, accounting for around two-thirds of total GDP.
While government spending and investment are also important components of aggregate demand, they are typically smaller than consumption. Government spending refers to the purchases of goods and services by federal, state, and local governments, and investment refers to spending on capital goods such as machinery and equipment, as well as construction of new buildings and other structures. Net exports, which refer to the difference between exports and imports, are also an important component of aggregate demand, but their contribution to the overall economy is generally smaller than consumption.
Overall, consumption is the largest driver of economic activity in the U.S. economy, and its performance is closely watched as an indicator of overall economic health.
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Identify which of the following are temporary accounts of San Migael Company. a. accumulated depreciation b. owners drawings c. equipment d. owner's capital
Temporary accounts are those that are used to record transactions that occur during a specific period of time, usually a fiscal year. These accounts are closed at the end of each period and their balances are transferred to the company's retained earnings account. In contrast, permanent accounts, such as owner's capital, equipment, and accumulated depreciation, are not closed at the end of each period and their balances carry forward from one period to the next.
Based on this definition, we can determine that accumulated depreciation, owner's drawings, and owner's capital are temporary accounts of San Miguel Company. This is because accumulated depreciation and owner's drawings are used to record transactions related to the company's assets and equity during a specific period of time. Owner's capital is also a temporary account because it is used to record changes in the owner's equity during a specific period of time.
On the other hand, equipment is a permanent account because it represents a long-term asset that the company will continue to use and maintain over multiple accounting periods. Its balance will not be closed at the end of a period and will carry forward to the next period.
In conclusion, accumulated depreciation, owner's drawings, and owner's capital are the temporary accounts of San Miguel Company, while equipment is a permanent account.
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Prepare the journal entry to account for the transaction as of February 12, 2020, clearly identifying the revenue or deferred revenue associated with each performance obligation.
To prepare the journal entry for the transaction as of February 12, 2020, we need to identify the revenue or deferred revenue associated with each performance obligation. Let's assume that the transaction involves selling software and providing maintenance services. The software and maintenance services are two separate performance obligations.
The revenue associated with the sale of software will be recognized upfront because it represents a single performance obligation. Therefore, we will record the following journal entry:
Debit: Cash/Accounts Receivable (depending on the method of payment) $10,000
Credit: Software Revenue $10,000
The revenue associated with the maintenance services will be recognized over time because it represents a separate performance obligation. Therefore, we will defer revenue recognition for the maintenance services until they are provided. Let's assume that the maintenance services will be provided for a period of one year, and the total amount of revenue associated with the maintenance services is $2,000. We will record the following journal entry:
Debit: Deferred Maintenance Revenue $2,000
Credit: Cash/Accounts Receivable (depending on the method of payment) $2,000
As the maintenance services are provided over the next year, we will recognize $167 ($2,000 divided by 12) of revenue each month. The monthly journal entry will be:
Debit: Deferred Maintenance Revenue $167
Credit: Maintenance Revenue $167
By the end of the year, the entire $2,000 of deferred revenue will be recognized as maintenance revenue.
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Olney Science Corporation has total assets of $350,000 and total debt of $100,000. If it has 40,000 shares outstanding, what is the book value per share
The book value per share can be calculated by subtracting the total debt from the total assets to get the total equity, and then dividing by the number of shares outstanding.
Total equity = Total assets - Total debt = $350,000 - $100,000 = $250,000
Book value per share = Total equity / Number of shares outstanding = $250,000 / 40,000 = $6.25 per share.
Therefore, the book value per share for Olney Science Corporation is $6.25.
1. Determine the company's total equity by subtracting total debt from total assets:
Total Equity = Total Assets - Total Debt
Total Equity = $350,000 - $100,000
Total Equity = $250,000
So, the book value per share for Olney Science Corporation is $6.25.
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If average total cost is decreasing as more and more units are produced, then marginal cost must be:
If the average total cost is decreasing as more and more units are produced, then it implies that the company is experiencing economies of scale. Economies of scale mean that as the company produces more units, it can spread its fixed costs (such as rent, salaries, and equipment) over a larger number of units.
This leads to a decrease in the average total cost of each unit produced.
When the average total cost is decreasing, it means that the marginal cost of producing each additional unit is less than the average total cost. This is because the fixed costs have already been covered by the previous units produced, and each additional unit only incurs variable costs, which are typically lower.
Therefore, if the average total cost is decreasing, then the marginal cost must be less than the average total cost. In other words, the marginal cost is decreasing as more units are produced. This means that the company is experiencing increasing returns to scale, which means that the marginal cost is decreasing as the company produces more units.
In conclusion, if the average total cost is decreasing as more and more units are produced, then the marginal cost must be decreasing as well. This indicates that the company is experiencing economies of scale and increasing returns to scale, which are positive indicators for the company's profitability and growth.
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On April 1, Cyclone Company purchases a trencher for $312,000. The machine is expected to last five years and have a salvage value of $56,000. Compute depreciation expense at December 31 for both the first year and second year assuming the company uses the double-declining-balance method. (Enter all amounts as positive values.)
The double-declining-balance method applies a depreciation rate that is twice the straight-line rate, based on the depreciable cost of the asset at the beginning of the year.
To calculate the depreciation expense for each year:
First year:
Depreciable cost = cost - salvage value = $312,000 - $56,000 = $256,000
Depreciation rate = 2 / 5 = 40%
Depreciation expense = depreciation rate x depreciable cost = 40% x $256,000 = $102,400
Depreciation expense at December 31 for the first year is $102,400.
Second year:
Depreciable cost = cost - accumulated depreciation = $312,000 - $102,400 = $209,600
Depreciation rate = 2 / 5 = 40%
Depreciation expense = depreciation rate x depreciable cost = 40% x $209,600 = $83,840
Depreciation expense at December 31 for the second year is $83,840.
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The particular price that results in quantity supplied being equal to quantity demanded is the best price because it Group of answer choices maximizes costs of the seller. maximizes tax revenue for the government. maximizes the combined welfare of buyers and sellers. minimizes the expenditure of buyers.
The particular price that results in quantity supplied being equal to quantity demanded is the best price because it maximizes the combined welfare of buyers and sellers.
This price is commonly referred to as the equilibrium price. At this price, the quantity of goods or services demanded by buyers is equal to the quantity of goods or services supplied by sellers.
This results in a situation where neither buyers nor sellers have an incentive to change their behavior. At the equilibrium price, buyers and sellers are able to trade freely and mutually benefit from the exchange.
Buyers are able to purchase the quantity of goods or services they desire at a price they are willing to pay.
Similarly, sellers are able to sell the quantity of goods or services they wish to supply at a price that covers their costs and earns them a reasonable profit.
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