Answer and Explanation:
d. is the Fed's primary monetary policymaking body.
Opportunity costs are _____.
- the costs incurred by a firm to preserve its market share
- benefits gained as a result of accepting a particular project
- the costs of pursuing a specific project
- benefits lost due to taking on a particular project
Answer:
- benefits lost due to taking on a particular project
Explanation:
Opportunity costs are also known as the real cost, or the cost of the alternative forgone. Due to the limited resources, a company has to select what project to embark on and what project to leave undone. The opportunity cost is not the benefit gained as a result of accepting a particular project but that lost as a result of the acceptance.
Therefore the last option - benefits lost due to taking on a particular project is right.
In the traditional advertising model, advertisers were charged using a __________ approach, which charged for the exposures to an ad. Google transformed the traditional model to a model called __________ where advertisers pay only when someone actually clicks on the ad and is sent to their website.
Answer:
The correct answers that fills the gaps are: Cost per Thousand; Cost per Click.
Explanation:
Cost per Click (CPC), Cost per Thousand Impressions (CPM) and Cost per Acquisition (CPA) are collection methods used by digital media platforms. The CPC is calculated based on the number of clicks on the ads, the CPM for impressions, and the CPA for the number of conversions.
CPM, or Cost per thousand impressions, is a metric that represents the cost generated per thousand impressions of the ad. Obviously they are not literal impressions, but the number of times that certain advertising was displayed to the public on the internet.
By choosing CPM as a form of payment, the advertiser agrees to pay the publisher of the ad a pre-determined amount for every thousand impressions. This means that the publisher receives compensation for each ad shown, having more predictability of profit.
The cost per click is a form of payment of paid advertisements in which for a number of clicks made the payment is made. That is, the advertiser pays for visitors who access the site where the ad was made for their site.
Tito Company reports a $20,000 increase in inventory and a $5,000 decrease in accounts payable during the year. Cost of Goods Sold for the year was $282,000. Using the direct method of reporting cash flows from operating activities, cash payments made to suppliers were
Answer: Cash payments made to suppliers were $307,000
Explanation:
In order to find cash paid to suppliers we start from the cost of goods sold, add any increase in inventory to it, subtract any decrease in inventory, add any decrease in accounts payable, subtract any increase in accounts payable.
So 282,000+20,000+5,000= 307,000
A manager that looks at loans and deposits increases and decreases among other things to measure the bank's liquidity position is using:
a. signals from the marketplace
b. the liquidity indicator approach
c. the sources and uses of funds approach
d. the structured funds approach
e. None of the options is correct
Answer:
The answer is letter C
Explanation:
The sources and uses of funds approach.
Which of the following represent the newer tools of digital direct marketing? A. Telemarketing, direct-mail marketing, and catalog marketing B. Telemarketing, face-to-face selling, and kiosk marketing C. Direct-response TV marketing, telemarketing, and direct-mail marketing D. Online marketing, social media marketing, and mobile marketing E. Kiosk marketing, telemarketing, and direct-response TV marketing
Answer:
D. Online marketing, social media marketing, and mobile marketing
Explanation:
Digital direct marketing is a fusion of digital and direct marketing. Digital includes online and mobile (smartphone) media, while the traditional media often refers to telephones, TV, brick-and-mortar shops...
Since the term direct refers to the way of approaching customers, it is important to make a distinction between marketing channels and media that are aimed for a wider public, and the ones that have the possibility of targeting a specific customer or target group.
The only answer that includes types of DDM (digital direct marketing) is D.
Online and social media marketing are tightly related and are digital by nature. They have the functionality to target customers directly with the aid of cookies and data provided by social media. Also, mobile marketing is direct and digital too, as it is related to smartphones and unique phone numbers (thus, it is direct).
The newer tools of digital direct marketing are online marketing, social media marketing, and mobile marketing. Online marketing uses the internet to deliver promotional messages, social media marketing involves content creation and sharing on social media platforms, and mobile marketing uses digital strategies to reach audiences on mobile devices.
Explanation:In the context of marketing, the newer tools of digital direct marketing are represented by option D: Online marketing, social media marketing, and mobile marketing. These tools have gained significance due to the increased use of internet and mobile devices. Online marketing or Internet marketing uses the internet to deliver promotional marketing messages to consumers. It includes email marketing, search engine marketing (SEM), social media marketing, many types of display advertising, and mobile advertising. Social media marketing involves creating and sharing content on social media networks to achieve your marketing and branding goals. Lastly, mobile marketing is multi-channel, digital marketing strategy aimed at reaching a target audience on their smartphones, tablets, and other mobile devices.
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After a kick-off session and six contentious weekly team meetings, Lola is struggling to align her team around common expectations. These expectations are: how to work together, communicate effectively, and identify appropriate hand-off points as her team provides customer service and technical support for a new product line. Two team members in particular keep butting heads on every issue and Lola is losing patience with their inability to work together. Based on Bruce Tuckman’s theory of team development, where is Lola’s team currently in the evolution process?
Answer:
storming
Explanation:
Based on Bruce Tuckman’s theory of team development it seems that Lola's team is currently in the storming phase of the evolution process. This is the second phase in the process, in which individuals are still showing hostility towards one another and have not have not fully assigned or understand each persons role in the team. This leads to resisting control from any authority within the group, and prevents team goals from being achieved.
Final answer:
Lola's team is in the storming phase of Bruce Tuckman's team development model, dealing with conflicts that are typical during this stage. To advance, the team will need to establish clear expectations, improve communication, and resolve conflicts to develop cohesion and eventually become more effective and reach the performing phase.
Explanation:
Based on Bruce Tuckman's theory of team development, Lola's team appears to be in the storming phase. This is characterized by conflicts and power struggles among team members as they attempt to establish their roles and understand how to work together. Lola is witnessing behavior typical for this developmental stage, including difficulty in aligning around common expectations such as communication and appropriate hand-off points in providing customer service and technical support.
To encourage progression to the norming phase, where teams develop standards and cohesiveness, Lola may need to redefine the team's rules, facilitate better communication, establish clearer roles, and perhaps engage in team-building exercises or conflict resolution strategies. Reference to Tuckman's model suggests that once these issues are resolved and cooperation improves, Lola's team can move toward the performing stage, where they can effectively work towards their goals with a sense of shared responsibility.
Triano Brothers, an insurance firm, follows an administrative procedure for measuring the relative worth of its jobs. The organization does this by assembling and training a committee consisting of people familiar with the jobs. The committee includes a human resource specialist and, if the budget permits, an outside consultant is hired. Which of the following is exemplified in this scenario?
a. job rotation
b. Job evaluation
c. Merit pay system
d. Job enrichment
e. Work structure
Answer: Option (B)
Explanation:
Here, in this case we can state that job evaluation is being exemplified. The Triano Brothers are using job evaluation, so as to have a systematic approach in order to determine value of a job in regards to the several jobs in their organization. The organization attempts to have a orderly comparison in between different jobs as to assess the relative value.
Which of these is true about the cash cow?
a. It generates tremendous profits in a rapidly growing industry.
b. It has a small market share in a rapidly growing industry.
c. It has a small market share in a slow growth industry.
d. It has a large market share in a slow growth industry.
e. It is generally a dead business that should be divested.
Answer:
d
Explanation:
Cash cow relates to a company investment in a low growth market with a high market share.....
A decision tree a. presents all decision alternatives first and follows them with all states of nature. b. presents all states of nature first and follows them with all decision alternatives. c. alternates the decision alternatives and states of nature. d. arranges decision alternatives and states of nature in their natural chronological order.
Answer:
The correct answer is (D)
Explanation:
The decision tree is a choice help tool that uses a tree-like model of choices and their potential results, including chance occasion results, asset expenses, and utility. It is one approach to show a calculation that just contains restrictive control explanations. A decision tree is a scientific model used to assist managements with deciding. A choice tree utilises evaluations and probabilities to compute likely results. It helps to decide which alternative must be choose. The solution starts by selecting pay-offs from left to right in reverse order in a chronological order.
Frito-Lay has developed a new line of snack foods. The company wants to place the products in as many outlets as possible; grocery stores, vending machines, convenience stores and restaurants. By doing so, Frito-Lay is striving to achieve _______ distribution.
Answer: Intensive distribution
Explanation:
Here, in this particular case Frito-Lay is trying to accomplish the Intensive Distribution. Intensive distribution is referred to as the marketing strategy under which an organization tends to sell their respective commodity through their several outlets or store as, in order to have the individuals and their respective customers confront the commodity virtually almost everywhere.
Garland Mills purchased a certain piece of machinery 4 years ago for $500,000. Its present resale value is $340,000. Assuming that the machine's resale value decreases exponentially, what will it be 5 years from now? (Round your answer to the nearest dollar.)
Answer:
The machine's resale value in 5 years from now will be $309,392
Explanation:
Future value = present value*exp(cx)
$340,000 = $500,000*exp(4c)
17/25 = exp(4c)
c = -0.096
Future value = present value*exp(cx)
= $500,000*exp(-0.096*5)
= $309,391.70
Therefore, The machine's resale value in 5 years from now will be $309,392
The question involves the concept of exponential decay in economics, as the resale value of a machine decreases over time. A mathematical formula relating the initial purchase price, resale value, decay constant, and time elapsed can be used to calculate the resale value of a machine in the future.
Explanation:The subject of this question is exponential decay, which is a topic in mathematics. Garland Mills' machinery purchase qualifies as an example of exponential decay in economics because the resale value of the machinery decreases exponentially over time.
The equation for exponential decay is R = R0 * e^(-kt), where R is the final amount remaining (resale value in the future), R0 is the initial amount (initial purchase price), k is the decay constant and t is the time elapsed. From the given information, we can calculate k using the formula k = -ln(R/R0) / t where ln is the natural logarithm. Once k is known, we can calculate the future resale value for any time t.
Substituting the values from the question, R0 = $500,000, R = $340,000, and t = 4 years, we can calculate k. Then substituting the value of k and t = 9 years (4 years in the past and 5 years in the future) in the decay formula, we can calculate the resale value of the machine 5 years from now.
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Ella had been using an imported brand of shampoo for several years, but she could no longer find it anywhere. As she was considering what kind of shampoo to try, she was surprised to see ads for Procter & Gamble's Head and Shoulders, which was being promoted as a glamorous health-oriented product. She had always thought of Head and Shoulders as an anti-dandruff shampoo. The new ads suggest that Head & Shoulders has been:
Answer:
rebranded
Explanation:
Rebranding tries to give a new image to an old product, in order to make it look attractive and successful. This new look will try to make the product more attractive and successful.
Head & Shoulders was seen as an anti-dandruff shampoo, and it was quite successful in its specific market. But then it changed its identity to be seen as a glamorous health oriented shampoo. If people see Head & Shoulders that way then its marketing strategy was very good since there is nothing glamorous in dandruff.
If an organization considers its IS organization as a game changer, then its strategy would be to use IS to achieve competitive advantage.
A. True.
B. False.
Answer:
The answer is false, letter B
Explanation:
Because to be a true statement the strategie would be to achieve competitive advantage by making IS investments that enable new prodcuts and services.
Final answer:
The statement is true; organizations may see their IS as a game changer and use it strategically to gain competitive advantage through efficiencies, innovation, and enhanced customer value.
Explanation:
The statement suggests that if an organization sees its Information Systems (IS) organization as a game changer, it would strategize to use IS to achieve a competitive advantage. This is indeed true. Organizations that view their IS as a critical component for success often leverage it to realize efficiencies, innovate processes, and provide superior value to customers, thereby gaining an edge over competitors. For example, implementing advanced data analytics can lead to better decision-making, or using customer relationship management (CRM) systems can enhance customer satisfaction and loyalty.
Machinery purchased for $60,000 by Tom Brady Co. in 2016 was originally estimated to have a life of 8 years with a salvage value of $4,000 at the end of that time. Depreciation has been entered for 5 years on this basis. In 2021, it is determined that the total estimated life should be 10 years with a salvage value of $4,500 at the end of that time. Assume straight-line depreciation.a. Prepare the entry to correct the prior years' depreciation, if necessary.b. Prepare the entry to record depreciation for 2021.
Given a change in the estimated life and salvage value of a machine, we first calculate the initial depreciation and then adjust for the updated values. No entries are necessary for prior years, but a journal entry is required for 2021 to record the annual depreciation of $4,100.
Explanation:The situation you have described involves recalculating depreciation for an asset, in this case, a piece of machinery owned by Tom Brady Co., given a change in its estimated total life and salvage value. Understand that depreciating an asset is essentially a method of allocating the cost of that asset over its useful life, so when that estimated useful life changes, so too does the annual depreciation expense.
First, let's calculate the initial depreciation over 5 years. The machinery was purchased for $60,000 with a salvage value of $4,000; hence, its depreciable base was $56,000 ($60,000 - $4,000). Given an 8-year life, the annual depreciation would've been $7,000 ($56,000 / 8 years). By 2021, therefore the cumulative depreciation would be $35,000 ($7,000 per year for 5 years).
In 2021, however, the estimated total life has changed to 10 years, and the salvage value is now $4,500. That changes the total depreciable base to $55,500 ($60,000 - $4,00). As 5 years has passed, it means that the machinery would be depreciated over the remaining 5 years ($55,500 - $35,000) / 5, which make an annual depreciation of $4,100. So, the depreciation expense for 2021 would be $4,100.
To answer part a), no correction is needed for the prior years' depreciation because the change is treated prospectively, not retrospectively. For part b), a journal entry would include debiting (increasing) Depreciation Expense by $4,100 and crediting (increasing) Accumulated Depreciation by $4,100 to record the annual depreciation for 2021.
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The Malcolm Baldrige National Quality Award aims to:
(I) publicize successful quality programs.
(II) recognize quality achievements of U.S. companies.
(III) stimulate efforts to improve quality.
(IV) distribute the grant money available for improved quality.
a.II and III only
b.I, II, and III only
c.I and IV only
d.I and II only
e.I, II, III, and IV
Answer:
B) I, II, and III only
Explanation:
The Malcolm Baldrige National Quality Award (MBNQA) was established by the US Congress in 1987. It's main purpose is the recognition for performance excellence that American organizations can achieve. The MBNQA is the nation's highest presidential honor an organization can receive for performance excellence.
Three MBNQA awards are given out every year in six categories (18 awards in total):
Manufacturing Service Company Small Business Education Healthcare Non-profit
12. Stocks A and B have the following data. The market risk premium is 6.0% and the risk-free rate is 6.4%. Assuming the stock market is efficient and the stocks are in equilibrium, which of the following statements is CORRECT? A B Beta 1.10 0.90 Constant growth rate 7.00% 7.00% a. Stock A must have a higher stock price than Stock B. b. Stock A must have a higher dividend yield than Stock B. c. Stock B's dividend yield equals its expected dividend growth rate. d. Stock B must have the higher required return. e. Stock B could have the higher expected return.
Answer:
b. Stock A must have a higher dividend yield than Stock B.
Explanation:
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c. Assume that Bon Temps has a beta coefficient of 1.2, that the risk-free rate (the yield on T-bonds) is 3%, and that the required rate of return on the market is 8%. What is Bon Temp’s required rate of return?
Answer:
9%
Explanation:
This question tests your understanding of the application of the CAPM (Capital Asset Pricing Model) formula.
The risk-free rate is the rate of return which an investment with no risk is expected to give. This is usually associated with investments in government securities (bonds) as governments are not expected to default.
The required return on market is the minimum return an individual expects to get from investing in a company
Beta co-efficient is the measure of volatility in relation to the market
The CAPM formula for calculating required rate of return is;
Ke = Rf + B(Rm - Rf)
where Rf = 3%
Rm = 8%
B = 1.2
Ke = 3% + 1.2*(8-3)
= 3% + 1.2*(5)
= 3% +6%
= 9%
I hope this helps you understand the question better and you can solve similar questions
Final answer:
The required rate of return for Bon Temps can be calculated using the Capital Asset Pricing Model (CAPM) formula.
Explanation:
The required rate of return for Bon Temps can be calculated using the Capital Asset Pricing Model (CAPM) formula:
Required rate of return = Risk-free rate + Beta coefficient × (Market rate of return - Risk-free rate)
In this case, the risk-free rate is 3%, the beta coefficient is 1.2, and the market rate of return is 8%.
Therefore, the required rate of return for Bon Temps is:
Required rate of return = 3% + 1.2 × (8% - 3%)
= 3% + 1.2 × 5%
= 3% + 6%
= 9%
Benny employs people to sell candy bars at intersections. Assume that Benny can obtain candy bars to sell for no cost. The marginal product of the last worker Benny hired is 20 candy bars per hour. Benny pays $7 per worker per hour and sells the candy bars for $1 each. If the price of candy bars rises to $2, then the:
Answer:
Benny will hire more candy sellers.
Explanation:
Benny is currently making a $13 per hour profit for every candy seller that he hires: $20 (marginal product) - $7 (salary) = $13
If the price of candy bars increases to $2 and the quantity demanded remains unchanged, Benny will be making a $33 profit for every candy seller: $40 (marginal product) - $7 (salary) = $33
So Benny will be highly motivated to hire more candy sellers in order to keep increasing his profit.
Hillward Bakers Inc. has been using a logo with the letters"HB-in blue color and a baker's hat above these letters since its inception ten years ago. This logo has since been connected with Hillward Bakery by its customers. Hobert Bakers Inc., a newly opened bakery and confectionary chain, uses the same logo. Hillward has not registered its logo, but chooses to sue Hobert. Which of the following is true of this case?
A. Hillward cannot sue Hobert since the logo has not been registered as a trademark
B. Hillward can sue Hobert since the logo has been used by Hillward and is associated with it.
C. Hobert can defend that Hillward created something that lacks utility and cannot be trademarked
D. Hobert can defend that Hillward created something that was very obvious.
E. Hillward cannot sue Hobert because logos cannot be patented or trademarked.
Answer:
B) Hillward can sue Hobert since the logo has been used by Hillward and is associated with it.
Explanation:
Since Hillwards logo is an elaborate piece of creative art, then they can sue Hobert for using their logo since it was associated directly to them during the past decade. Common logos are not usually protected by copyright unless they show significant creative artwork done.
It is always better and easier to protect a logo when it is a registered trademark but even if you haven't registered it you can still sue and win for infringement. When a company uses a logo, especially for a long time, it is establishing common law trademark rights.
After being influenced by frequent advertisements, Jeremy buys a new cell phone. However, he discovers that the new cell phone does not offer the features he expected. This scenario illustrates that the _____ of the purchase is less than Jeremy's expectations.A) perceived valueB) actual valueC) an evoked setD) a consumer set
Answer: The actual value
Explanation: In simple words, actual value refers to the utility satisfaction that a customer receives after purchasing a product.
The only difference between perceived value and actual value is that while calculating perceived value the customer compares his product with other product . However, while calculating actual value he only compares the existing performance with his or her expectations.
In the given case, Jeremy feels the product he buy is no as useful as he thought. Hence it lacks actual value.
St. Augustine Corporation originally budgeted for $360,000 of fixed overhead at 100% of normal production capacity. Production was budgeted to be 12,000 units. The standard hours for production were 5 hours per unit. The variable overhead rate was $3 per hour. Actual fixed overhead was $360,000, and actual variable overhead was $170,000. Actual production was 11,700 units. The fixed factory overhead volume variance is
Answer:
$9,000 unfavorable
Explanation:
The computation of the total fixed overhead variance is shown below:
= Actual fixed overhead costs - Budgeted fixed overhead
where,
Budgeted fixed overhead is $360,000
And, the Actual fixed overhead cost is computed below:
= Actual fixed overhead × Actual production ÷ budgeted production
= $360,000 × 11,700 units ÷ 12,000 units
= $351,000
Now put these values to the above formula
So, the value would equal to
= $351,000 - $360,000
= $9,000 unfavorable
A recent survey revealed that more than nine out of ten people prefer a watch made by firms in Switzerland to one made in India or U.S.A or any other country. This is an example of _____.a. benchmarking.b. the country-of-origin effect.c. the liability of foreignness.d. agglomeration
Answer:
The correct answer is (B)
Explanation:
In this case country of origin effect has made people to prefer a watch made in Switzerland. Country of origin effect, , is a mental impact depicting how people frames of mind, recognition and obtaining choices affected by different country products. For example, customers prefer Italian pizza over others, that is a country of origin effect
Which of the following would shift the demand for dollars in the market for foreign currency exchange to the right?
a. foreign citizens want to buy more U.S. goods and services at a given exchange rate
b. foreign citizens want to buy fewer U.S. goods and services at a given exchange rate
c. foreign citizens want to buy more U.S. bonds
d. foreign citizens want to by fewer U.S. bonds
Answer:
The correct answer is option a.
Explanation:
An increase in the demand for dollars will shift the demand curve to the right, in the market for foreign exchange. Dollars are demanded by foreign consumers to pay for the import or purchase of US products.
An increase in the demand for goods and services by the foreign producers will increase the demand for US dollars as well.
This will cause the demand for dollars curve to shift to the right. This rightward shift in the curve will increase the value of US dollars in the foreign exchange market.
Answer:
They make trade easier and more efficient.
Explanation:
The process of anticipating rivals’ actions in order to both revise a firm’s plan and prepare to deal with rivals’ response is called _____.
a. mutual forbearance
b. prisoners’ dilemma
c. competitor analysis
d. multimarket competition
Answer:
Letter c is correct. Competitor analysis
Explanation:
Competitor analysis is a vital practice for those who are starting a business and who already have a consolidated brand in the market. Conducting a competitor analysis helps you better understand the marketing landscape and understand how your organization's positioning stands with its competitors.
By evaluating competitors, it is possible for a company to find development opportunities and better understand which challenges and continuous improvements need to be implemented. Competitor analysis can be conducted through market research, press, commentary and opinions, the internet and advertising.
Christina will be retiring next month from her job after 35 years as a school bus driver. Over the last 35 years, Christina’s annual salary averaged $22,040. She expects to receive some money each month from Social Security and plans to take the rest of the money she needs to pay the monthly bills from savings. Each month her bills total to about $1,375. Assuming her annual Social Security benefit will be 42% of her salary average, how much will she need to take from savings each month to help pay the bills?
Answer:
$603.6
Explanation:
Christina’s annual salary averaged = $22,040
Annual Social Security benefit = 42% of her salary average
Christina’s total bill each month = $1,375
Now,
The amount of Annual Social Security benefit = 42% of $22,040
= 0.42 × $22,040
= $9,256.8
Thus,
The amount of monthly Social Security benefit
= ( Annual Social Security benefit ) ÷ 12
= $9,256.8 ÷ 12
= $771.4
Therefore,
The amount she need to take from savings each month to help pay the bills
= Christina’s total bill each month - Amount of monthly Social Security benefit
= $1,375 - $771.4
= $603.6
Answer:
(B) $603.60
Explanation:
Edge 2020
Wisconsin Cheddar has introduced a new product called "aged jalapeno cheddar". Displays are set up at various retail cheese stores throughout California and potential buyers are offered free samples when they walk past the displays, as well as $2 off coupons. what type of promotion is this an example of????
Answer:
Sales promotions
Explanation:
Sales promotions are the planned activities that a business takes to stimulate demand and increase sales. In sales promotions, the company applies attractive short-term methods to persuade customers to buy products. Sales promotions mostly target consumers. Businesses may also initiate sales promotion aiming at encouraging traders to sell more.
Techniques used in sales promotion include discount vouchers, money-off-coupons, free samples, and competitions. Wisconsin Cheddar is conducting a sales promotion. The displays, free samples, and discount coupons are meant to encourage customers to buy. Sales promotions are useful in introducing new products in the markets. They help push-up sales volumes, although it could be temporarily.
E-Gadgets is a chain of electronics stores that specializes in devices and gadgets incorporating cutting-edge technologies. The company has more than 170 stores located in large cities throughout the Southeast and Midwest. E-Gadgets has chosen the locations of its stores so that most customers living in upper middle class and wealthy neighborhoods can get to an E-Gadgets store in less than 15 minutes. E-Gadgets is providing its customers with__________.
A)scrambled merchandising.B)allocative utility.C)place utility.D)saturation marketing.
Answer: Option (C)
Explanation:
Here, in this case the corporation E-Gadgets is providing its consumers with place utility. The organization E-Gadgets creates the utility for their product solely by character of its location. The organization is known to have more than 170 outlets that are located in most of the large cities. Under the place utility it is known that the attractiveness of a commodity that is sold can be further increased by changing the location.
Tone Zone plans to introduce four mp3 player models over the next year. These models range from basic players at $99 per unit, to more sophisticated players at $399 per unit. The more features a model has, the more expensive it is. What pricing strategy is Tone Zone using for its range of mp3 players?
A) product line pricing
B) product bundle pricing
C) captive product pricing
D) by-product pricing
E) optional product pricing
Answer: Product line pricing
Explanation: In simple words, it refers to a pricing strategy under which the organisation separates its product on the basis of cost and price so that various quality products could be offered in the market to capture different classes of customers.
This strategy helps an organisation to prepare a vast customer base and is generally used by the firms in economies where there is too much income gap present and the firms offering the products are few.
Sometimes the prices are differentiated on the basis of unique quantities that have same utility value but have different customers preference.
If, for a given output level, a perfectly competitive firm's price is less than its average variable cost, the firm A. should increase price. B. should shut down. C. is earning a profit. D. should increase output.
Answer:
B. should shut down.
Explanation:
In the short run, if price is less than average variable cost, the firm should shut down; cease production temporarily. It would be better for the firm to shut down than to continue production and earn losses. If output is increased, average variable cost increases and loss increases.
A perfect competition firm is a price taker so it cannot adjust the price for its products.
Suppose that currency traders expect that the value of U.S. dollarU.S. dollar will fall in the future. How will this will affect the demand and supply of U.S. dollarU.S. dollar in the foreign exchange market?
Answer:There will be increase in supply and decrease in demand
Explanation:
One of the Law of demand states that the lower the price the higher the quantity demanded and vice versa, while for supply it states that the higher the price the higher the quantity supplied and vice versa.
Since the value of US dollar is still high then the supply will be high in the market, but with the expectation of future fall, demand will be low because buyers are waiting for drop in value. There will be excess supply and lower demand.