The Demand For Resources Exercise 1 (Algo) Ronnie owns a cookie store. He has carefully recorded the number of cookies that his shop can produce per day with different numbers of workers. The table below shows the different number of workers and the "Total Product column shows their output. The current market price for Ronnie's cookies is $0.80 per cookie. Assume this is a perfectly competitive market Fill in the "Marginal Product," "Total Revenue," and "Marginal Revenue Product" columns. Instructions: Enter your answers as a whole number. Total Revenue (dollars) SO Marginal Revenue Product (dollars) (cookies) Ronnie's Cookie Store and Revenues Labor (workers) (cookies) 0 0 1 60 2 140 3 200 4 240 260 (dollars) 0.80 0.80 0.80 0.80 0.80 0.80

Answers

Answer 1

Here is the table with the filled in columns, based on the question requirements

Ronnie's Cookie Store and Revenues

Labor (workers) Total Product (cookies) Marginal Product (cookies) Price (dollars) Total Revenue (dollars) Marginal Revenue Product (dollars)

0 0 0 0.80 0 0

1 60 60 0.80 48 48

2 140 80 0.80 112 64

3 200 60 0.80 160 48

4 240 40 0.80 192 32

5 260 20 0.80 208 16

It is evident that the productivity of each additional worker declines as more workers are added to the workforce. The reason for this is that the workload of each worker reduces as the other workers are already functioning at their maximum capacity.

One can calculate the marginal revenue product of labor by multiplying the price of the product by the marginal labor productivity. The marginal revenue product of labor equals the price of a cookie, which is $0. 80

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Related Questions

The following information is available for Oriole Inc., a company whose shares are traded on the Toronto Stock Exchange:

Net income for 2023 $149,000

Average market price of common shares during 2023 (adjusted for stock dividend) $18

December 31, 2023 (fiscal year end) market price of common shares $18

Income tax rate for fiscal year 2023 30 %

Transactions in common shares during 2023: Change Cumulative shares

Jan. 1, 2023, common shares outstanding 70,200

Mar. 1, 2023, issuance of common shares 10,200 80,400

June 1, 2023, 10% stock dividend 8,040 88,440

Nov. 1, 2023, repurchase of common shares (10,200 ) 78,240

Other information:

1. For all of the fiscal year 2023, $110,000 of 6% cumulative convertible bonds have been outstanding. The bonds were issued at par and are convertible into a total of 10,400 common shares (adjusted for the stock dividend), at the option of the holder, at any time after issuance.

2. Call stock options for 20,600 common shares have been outstanding for the entire 2023 fiscal year and are exercisable at the option price of $23 per share (adjusted for the stock dividend).

3. For all of the fiscal year 2023, $110,000 of 4% cumulative convertible preferred shares have been outstanding. The preferred shares are convertible into a total of 15,600 common shares (adjusted for the stock dividend) at the option of the holder at any time after January 2028.

(a) Determine the weighted average number of common shares that would be used in calculating earnings per share for the year ended December 31, 2023. (Round answer to 0 decimal places, e.g. 5,275.)

Weighted average number of common shares enter the weighted average number of common shares rounded to 0 decimal places shares

Answers

The weighted average number of common shares for Oriole Inc. for the year ended December 31, 2023, is 78,240 shares.

To calculate the weighted average number of common shares for Oriole Inc. for the year ended December 31, 2023, we need to consider the changes in the number of common shares throughout the year. Here are the steps to determine the weighted average:

1. Start with the common shares outstanding on January 1, 2023, which is 70,200 shares.
2. Add the common shares issued on March 1, 2023, which is 10,200 shares, resulting in a cumulative total of 80,400 shares.
3. Consider the 10% stock dividend issued on June 1, 2023. Multiply the cumulative total shares (80,400) by 10% to get 8,040 additional shares. Add this to the cumulative total, resulting in 88,440 shares.
4. Deduct the repurchased shares on November 1, 2023, which is 10,200 shares. This brings the total to 78,240 shares.

To calculate the weighted average, we need to multiply the number of shares for each period by the proportion of the year they were outstanding. In this case, the shares were outstanding for the entire year, so the proportion is 1 for each period.

Therefore, the weighted average number of common shares for the year ended December 31, 2023, is 78,240 shares.

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mention and explain five creditors under which a cheque may be rejected​

Answers

Answer:

Insufficient funds: The cheque amount is more than the free balance available in the drawer's bank account. 2) Irregular signature: The signature of the drawer on the cheque does not match the specimen signature available with the bank.

Explanation:

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Complete the following sentence.
It is very common for job seekers in high-tech/ ____
technology fields to acquire certifications to assure agencies of their
qualifications

Answers

It is very common for job seekers in high-tech/ Information

technology fields to acquire certifications to assure agencies of their

qualifications.

What is information technology?

Information Technology is the use of hardware and software services, and related infrastructure to manage and deliver information using voice, data, and video.

The use of information technology  in today's personal, business uses is essential. It can be defined as the use of computers and other electronic devices for data reception, storage, retrieval, transmission, and manipulation.

Certifications demonstrate  that you are dedicated to your profession, possess unique abilities, and are eager to keep studying in order to be at the top of your game. certifications can help you gain the skills and credentials you need to get a job.

Thus, Information technology is an appropriate response.

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Which of the following three situations is least likely to occur at the same time as the other two situations? Why?
1) Real GDP is less than potential GDP.
2) An economy in a strong, 5-year expansion.
3) An unemployment rate above the natural rate of unemployment.

Answers

Answer: I'm going to take a guess and say 1 and 3.

Explanation: Just taking a guess.

"A 5 year 3 1/2% Treasury Note is quoted at 98-4 - 98-9. The note pays interest on Jan 1st and Jul 1st. A customer buys 5M of the notes. Approximately how much will the customer pay, disregarding commissions and accrued interest?"

Answers

Answer:

$4,914.06

Explanation:

Calculation for how much will the customer pay by disregarding commissions and accrued interest

The 5M which the customers used to buy the notes means that the customer is buying $5,000 par value of the notes.

Take note that the capital letter M in Latin means for $1,000.

Therefore the customer will have to buy at the ask price of 98 and (9/32nds =0.28125) which means that 98%+0.28125 will gives us 98.28127.

Now let calculate for how much will the customer pay by disregarding commissions and accrued interest

98.28125% * $5,000 par

= $4,914.06

Therefore the amount that the customer pay by disregarding commissions and accrued interest will be $4,914.06

Brian deposited $9000 into a savings account for which interest is compounded monthly at a rate of 2.36%. How much interest will he earn after 11 years?
Which formula would you use to solve this problem?
o I=Prt
o A-P
o A=P(1+r/n)^nt

Answers

The formula that would be used to solve this problem is A = P(1 + r/n)^nt.The amount of interest Brian will earn after 11 years is  $2,596.50

The cost associated with borrowing money is expressed in terms of interest. While the interest rate used to compute interest is often reported as an annual percentage rate(s), interest expense or revenue is frequently expressed as a dollar figure.where A is the amount after n years including interest, P is the principal amount, r is the annual interest rate, n is the number of times that interest is compounded per year, and t is the number of years. Brian deposited $9000 into a savings account for which interest is compounded monthly at a rate of 2.36%. To find the interest he will earn after 11 years, we will substitute the values given into the formula: A = P(1 + r/n)^ntA = 9000(1 + 0.0236/12)^(12 x 11)A = 9000(1 + 0.001967)^132A = 9000(1.001967)^132A = 9000 x 1.2885A = $11,596.50Therefore, the amount of interest Brian will earn after 11 years is $11,596.50 - $9,000 = $2,596.50. The answer is $2,596.50.

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I'm not sure which one to pick

I'm not sure which one to pick

Answers

Answer:

The Second One

Explanation:

Answer:

I think its an assumption Sorry if I'm wrong

Explanation:

the book value per share of topaz general ltd. is $10 per share and the company has a total of 4 million shares. calculate the total book value of common equity of the company.

Answers

The total book value of common equity of Topaz General Ltd. is $40 million. This is calculated by multiplying the book value per share ($10) by the total number of shares (4 million).

To calculate the total book value of common equity, we need to multiply the book value per share by the total number of shares. In this case, the book value per share is given as $10 and the total number of shares is 4 million.

Total book value of common equity = Book value per share × Total number of shares

Plugging in the values, we get:

Total book value of common equity = $10 × 4,000,000 = $40,000,000

Therefore, the total book value of common equity for Topaz General Ltd. is $40 million. This represents the total value of the company's common equity based on the book value per share and the number of shares outstanding.

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Which best explains why producers choose to specialize? choose two answers. to increase competition to gain a comparative advantage to decrease the amount of goods produced to maintain market share to increase efficiency

Answers

The reasons why producers choose to specialize are:

to gain a comparative advantageto increase efficiency.

What is specialization?

Specialization is when a producer concentrates on the production of some particular goods and services.

Advantages of specialisation

It increases economies of scaleIt increases the efficiency of the producer

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Answer:

B and E

to gain a comparative advantage

to increase efficiency

Explanation:

EDGE

A government official proposes taxing producers of plastic grocery bags at 10 cents per plastic bag. What effect
would the tax have on the market for grocery bags?

A Supply would increase.
B Demand would increase.
C Supply would decrease.
D Demand would decrease.

Answers

Answer:

Supply would decrease.

This question appears incomplete. However, to answer correctly, one needs to know the current tax rate on plastic grocery bags.

Thus, for the sake of this question, the current tax rate in the United States is 22 cents per shopping bag. However, the tax is charged by the suppliers, which is then paid by the final consumers.Hence, considering the current rate of 22 cents to a proposed rate of 10 cents, that means tax relief for the customers.Hence, in this case, the Demand would increase, as the customers would tend to buy more.

Therefore, the correct is option B "Demand would increase."

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what type of government action is part of fical policy

what type of government action is part of fical policy

Answers

Answer: C. Spending government money on schools

What are the equilibrium price and quantity of yo-yos?
Price Qd Qs
$1 100 10
$2 80 35
$3 60 60
$4 40 85
$5 20 110

Answers

3 dollars as qd =qs no surplus or shortage

a. accounts payable b. cash c. common stock d. accounts receivable e. rent expense f. service revenue g. office supplies h. dividends i. land j. salaries expense

Answers

The different accounts and their classification are listed below

:a. Accounts Payable: It is a liability account that records the amount the business owes to creditors.

b. Cash: It is an asset account that reflects the amount of currency and coins on hand as well as in the bank.

c. Common Stock: It is a shareholders’ equity account that represents the amount of money the business owes to its owners.

d. Accounts Receivable: It is an asset account that reflects the amount that the business owes to its creditors.

e. Rent Expense: It is an expense account that records the amount of rent paid by the business for the use of land, building, or equipment

.f. Service Revenue: It is an income account that reflects the total amount of money that the business has earned from rendering services.

g. Office Supplies: It is an asset account that reflects the amount of supplies that the business has on hand.h. Dividends: It is a shareholder’s equity account that records the money paid to shareholders.i. Land: It is an asset account that represents the value of land owned by the business

j. Salaries Expense: It is an expense account that records the amount of salaries paid by the business to its employees.

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Select the correct answer.
A restaurant manager reads a study on the health habits of the local community. However, he wants to validate this information with an internal secondary data source. Which of the following should he consult?

A. a census bureau report
B. newspaper articles from a national source
C. market research study
D. his company’s financial statements
E. networking contacts

Answers

Answer: C

Explanation: An internal source to validate the data is a marketing research paper that the business has already completed.

Answer:

C

Explanation:

right on edmentum

The coordinates of point T are ​(​0,​5). The midpoint of is ​(6​,​-4). Find the coordinates of point S.

Answers

Answer:

Point S is at (10,-11) :)

Explanation:

Smithfield meats produces pork products including hams, bacon, and does so through its own hog farms. this is an example of a business that is ____________.

Answers

Smithfield meats produces pork products including hams, bacon, and does so through its own hog farms. this is an example of a business that is "vertically integrated."

Smithfield Meats is an example of a vertically integrated business.\

Vertical integration refers to the combination of different stages of the production process within a single company or organization. In the case of Smithfield Meats, the company is involved in all aspects of the pork production process, from raising hogs on its own farms to processing the meat and distributing it to retailers and consumers.

By controlling the various stages of production, Smithfield Meats can ensure the quality and consistency of its products, streamline its operations, and potentially reduce costs. However, vertical integration can also pose risks if one aspect of the business is not performing well or if there are disruptions in the supply chain.

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What routine management practice in the Northeast has created anthelmintic resistant gastrointestinal strongyes?

Answers

Anthelmintic resistance in gastrointestinal strongyles is a growing concern in the Northeast region of the United States. One of the routine management practices that has been identified as a contributing factor to the development of this resistance is the over-reliance on anthelmintic drugs as the primary means of parasite control in horses.

Horses are often dewormed at set intervals, regardless of their individual parasite load or the effectiveness of the deworming agent used. This practice has created an environment where only the strongest parasites survive, reproduce and pass on their resistance to their offspring. Over time, this has led to an increase in the number of horses carrying anthelmintic-resistant strongyles.

To combat this problem, it is important to implement more targeted deworming practices that take into account an individual horse's parasite load, their living conditions and other factors that contribute to parasite exposure.

This can include performing regular fecal egg counts to monitor parasite loads, rotating pastures to minimize exposure, and reducing the use of anthelmintic drugs to only when necessary.

In conclusion, the routine management practice of over-reliance on anthelmintic drugs for parasite control in horses has contributed to the development of anthelmintic-resistant gastrointestinal strongyles in the Northeast region of the United States. It is important to implement more targeted and sustainable parasite control practices to prevent further development of anthelmintic resistance.

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what primary function is money serving when it is used to buy a ticket to a movie?

Answers

When money is used to buy a ticket to a movie, the primary function it is serving is acting as a medium of exchange.

Money serves as a medium of exchange when it is used to facilitate transactions and exchange goods or services. In the context of buying a movie ticket, money is being exchanged for the ticket, enabling the individual to access the movie screening. The ticket serves as proof of purchase and grants the holder the right to attend the movie.

Money's function as a medium of exchange allows for the smooth and efficient transfer of value between parties. It eliminates the need for bartering or the direct exchange of goods and enables individuals to easily obtain the goods and services they desire by using a universally accepted medium of exchange.

Other functions of money, such as a unit of account (providing a standard measure of value) and a store of value (retaining purchasing power over time), may also apply in the broader context of financial management and economic transactions. However, when money is used specifically to buy a ticket to a movie, its primary function is serving as a medium of exchange.

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what of the following components of the business concept is least likely to ensure the success of the venture?

Answers

Among the given components of the business concept, "Money" is least likely to ensure the success of a venture. While money is important for funding the business and its operations.

While having adequate financial resources is crucial for starting and running a business, it is not the sole determinant of success. Money alone cannot compensate for deficiencies in other areas of the business concept. Without strong customer demand, an effective business model, a broad distribution channel, and a compelling value proposition, even a well-funded venture can struggle to gain traction and generate sustainable revenue.

Customer demand is a vital factor as it signifies the market's interest and willingness to purchase the product or service being offered. A business may have abundant financial resources, but without a target market that desires the offering, it will struggle to generate sales and sustain profitability.

An effective business model is essential for creating a sustainable and profitable venture. It encompasses the strategy for revenue generation, cost structure, and value delivery. Even with substantial funding, a flawed or inefficient business model can lead to financial instability and eventual failure.

A broad distribution channel is crucial for reaching a wide customer base and maximizing the potential market reach. Without an effective distribution network, even a highly demanded product or service may fail to reach its target audience, resulting in missed sales opportunities and limited growth.

Finally, a compelling value proposition is critical for attracting customers and differentiating the business from competitors. It articulates the unique benefits and value that the product or service offers to customers. Without a strong value proposition, the business may struggle to stand out in a crowded market, regardless of the amount of money invested.

While money is important and necessary for various aspects of a business, it alone cannot guarantee success. A well-rounded and comprehensive business concept that incorporates customer demand, an effective business model, a broad distribution channel, and a compelling value proposition is vital for achieving long-term success and sustainability.

Complete Question:

What of the following components of the business concept is least likely to ensure the success of the venture?

a. Customer demand

b. An effective business model

c. Money

d. A broad distribution channel

e. Value proposition

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When planning your career future, one of the first things you can do is
A. Develop and action plan
B. Work toward your goals
C. Take a career assessment or interest inventory
D. Go on a job interview

Answers

Answer:

work toward your goal

Explanation:

i believe when you know what you want to become in life if you are in school ensure that you as the student work to keep your grade up to keep good grades to aid in the application of universities and colleges and also to get subjects after 5 years of schooling

If sales = 100, rate = 0.10, and expenses = 50, which of the following expressions is true?
a. sales >= expenses AND rate < 1
b. sales < 200 OR expenses < 100
c. expenses = rate OR sales = rate
d. two of the above

Answers

If sales = 100, rate = 0.10, and expenses = 50, than option a. sales >= expenses AND rate < 1 expressions is true.

A sale is a process that involves exchanging products or services for a specific sum of amount. To rephrase it in another way, a sale would be any procedure that entails giving the consumer possession of a thing  in return for payment.

Expenses are simply another word for cost. The operating costs that are incurred to generate business revenues are referred to as expenses in accounting. The total of all the processes that typically generate revenue might alternatively be stated as expenses.

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Select all that apply.
Common skills assessments administered during the employment interview process include:
none of the above
science
keyboarding
math

Answers

Answer:

Keyboarding and Math :)

Explanation:

what happens if my tax return is rejected after the deadline?

Answers

Something happens that you want to know which is something that your mind desires to know of what happens of what you asked and you’re desire is to know for the moment until you get the answer, you will be annoying people

An agreement between countries to encourage free trade and promote thegroup's collective economic interests is an__
O A. comparative advantage
OB. trade bloc
O C. absolute advantage
D. trade barrier

Answers

Answer:

OB. trade bloc.

Explanation:

A trade bloc is when a group of countries come together and form or create an agreement that reduced or even eliminates any restrictions on trade between themselves. This type of intergovernmental agreement allows the participating countries to have cordial economic relationships with each other.

Through this type of agreement, the regional barriers to international trade are open or given fewer restrictions to allow or encourage free trade between themselves. Moreover, it also allows them to trade among themselves and prevent the non-members from participating in any economic trade with the member nations.

Thus, the correct answer is option B.

Kenworth Company uses a job-order costing system. Only three jobs-Job 105, Job 106, and Job 107 were worked on during November and December. Job 105 was completed on December 10; the other two jobs were still in production on December 31, the end of the company's operating year. Data from the job cost sheets of the three jobs follow: Job Cost Sheet Job 105 Job 106 Job 107 November costs incurred Direct materials $16,700 $ 9,500 $ 0
Direct labour $13,200 $7,200 $ 0
Manufacturing overhead $21,120 $11,520 $ 0
December costs incurred Direct materials $0 $8,300 $21,700 Direct labour $4,150 $6,100 $10,200
Manufacturing overhead ? ? ?
The following additional information is available
a. Manufacturing overhead is applied to jobs on the basis of direct labour cost
b. Balances in the inventory accounts at november 30 were as follows

Answers

Predetermined overhead rate = $21120/$13200 = 160% of direct labor cost

How to solve

Work in process on Nov. 30 = $16700 + $13200 + $21120 + $9500 + $7200 + $11520 = $79240

Raw Materials Work in Process

Beg. Bal. 40600 34150 a. Raw materials issued 30000

a. Raw materials issued 30000 b. Direct labor incurred 20450

b. Direct labor incurred 20450 3-b. Manufacturing overhead applied 32720

3-b. Manufacturing overhead applied 32720 End. Bal. 6450 End. Bal. 100600

Finished Goods Manufacturing Overhead

Beg. Bal. 86000 a. Manufacturing overhead incurred 19270

a. Cost of goods manufactured 61810 b. Manufacturing overhead applied 32720

End. Bal. 147810 End. Bal. 1100

Event General Journal Debit Credit

a. Work in process 30000

Raw materials 34150

Manufacturing overhead 4150

(To record issue of materials)

b. Work in process 20450

Salaries & wages payable 28650

Manufacturing overhead 8200

(To record labor costs incurred)

c. Manufacturing overhead 19270

Accounts payable 19270

(To record manufacturing overhead costs incurred)

Predetermined overhead rate = $21120/$13200 = 160% of direct labor cost

Event General Journal Debit Credit

1 Work in process 61810

Finished goods 61810

(To record jobs completed and transferred)

Cost of Job 105 completed and transferred to finished goods = $16700 + $13200 + $21120 + $4150 + (160% x $4150) = $61810

Job 106 Job 107 Total

Direct materials 17800 21700 39500

Direct labor 13300 10200 23500

Manufacturing overhead 21280 16320 37600

Total cost $ 52380 48220 100600

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Which of these producer activities did you participate in this week? Check all that apply.
U
I served people at a restaurant, hotel, coffee shop, or other business.
I worked in a bank, library, or retail store.
I created art to be sold in an art show
I made a product
I did yard work or other chores for pay.

Answers

Answer:

2nd and 4th

Explanation:

Answer:

2 and 4

Explanation:

a. In 2015 , Bilal had a monthly salary of $4,166.5. Assume 2015 is the base year. In 2018 , the CPI went up to 106.3. His monthly salary in 2018 was $4,800. Did the purchasing power of Bilal go up? Please show calculations and explain your answers (2) b. In 2008 , there was a major housing mortgage crisis in the U.S. economy which eventually led to recession. At that time, there was a GDP Gap or loss of 10.75%. The natural rate of unemployment in 2008 was 5.1%. What was the unemployment rate in 2008 in the U.S.? c. Germany's current inflation rate of 1.8% and France"s current inflation rate is 1.3%. Using the rule of 70 , which country will first experience doubling of prices of goods and services? \$how calculations

Answers

In this case, the base year is 2015, so we'll use the salary in 2015 ($4,166.5) and the CPI in 2018 (106.3) to calculate the adjusted salary in 2018.The formula is:Adjusted Salary in 2018 = $4,166.5 * 106.3 / 100 = $4,423.05

Comparing the adjusted salary in 2018 ($4,423.05) with Bilal's actual salary in 2018 ($4,800), we can see that his salary increased more than the adjustment for inflation. Therefore, the purchasing power of Bilal increased between 2015 and 2018.

b. The GDP Gap represents the difference between the actual Gross Domestic Product (GDP) and the potential GDP. In 2008, there was a GDP Gap or loss of 10.75%, which means the actual GDP was 10.75% lower than the potential GDP. The natural rate of unemployment, also known as the Non-Accelerating Inflation Rate of Unemployment (NAIRU), represents the unemployment rate at which inflation remains stable. In 2008, the natural rate of unemployment was 5.1%.

To calculate the unemployment rate in 2008, we need to add the GDP Gap to the natural rate of unemployment:

Unemployment Rate = Natural Rate of Unemployment + GDP Gap

Unemployment Rate = 5.1% + 10.75%

Unemployment Rate = 15.85%

Therefore, the unemployment rate in the U.S. in 2008 was approximately 15.85%.

c. To determine which country will first experience a doubling of prices of goods and services using the rule of 70, we divide the number 70 by the inflation rate to calculate the approximate number of years it will take for prices to double.

For Germany, with an inflation rate of 1.8%:

Approximate number of years = 70 / 1.8 = 38.89 years

For France, with an inflation rate of 1.3%:

Approximate number of years = 70 / 1.3 = 53.85 years

Comparing the two, Germany will experience a doubling of prices of goods and services sooner than France, as it will take approximately 38.89 years for prices to double in Germany, while it will take approximately 53.85 years for prices to double in France.

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explain reasons for NGO's and CBOs to be part of the market environment

Answers

Answer:

explain reasons for NGO's and CBOs to be part of the market environment

Explanation:

explain reasons for NGO's and CBOs to be part of the market environment

Explanation:

NGOs exist for a variety of purposes, usually to further the political or social goals of their members. Examples include improving the state of the natural environment, encouraging the observance of human rights, improving the welfare of the disadvantaged, or representing a corporate agenda.

howard company has sales revenue of $402,000 resulting in net operating income of $38,190. average invested assets are $201,000. what is the residual income if the hurdle rate is 12%?

Answers

Howard company has sales revenue of $402,000 resulting in net operating income of $38,190. The residual income rate is $ 14,070.

Calculating the problem:

Net Operating Income - (Average Invested Assets x Hurdle Rate).

Residual Income = $38,190 - ($201,000 x 12%) = $38,190 - $24,120 = $14,070.

Therefore, if the hurdle rate is 12%, is $14,070

How does a hurdle rate work?

In order to be considered feasible or acceptable, a project or venture must achieve a "hedge rate," a minimum rate of return. It is frequently referred to as the needed rate of return and is typically determined by an investor or business based on the venture's level of risk.

The hurdle rate ensures that the returns generated are sufficient to cover the money invested by serving as a benchmark against which to evaluate the investment's success. The hurdle rate may be influenced by the type of investment, the industry, and the economy as a whole.

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Question 1
(a) Comment on the limitations of using GDP as a way of measuring
economic well-being
(b) Distinguish between GDP deflator and Consumer Price Index

Answers

(a) Comment on the limitations of using GDP as a way of measuring economic well-being. b) GDP deflator and CPI are two important economic indicators that are used to calculate the level of inflation.

Gross Domestic Product (GDP) is one of the main measures of economic performance used to gauge economic well-being, as it is frequently considered a sign of a country's success. It has been used since the Second World War, and policymakers rely on it to make decisions and monitor economic growth. However, GDP is not without its flaws and limitations, including the following:It fails to capture the value of unpaid work, such as child-rearing and housework, which disproportionately affects women. It does not include the underground or black market economy, which could be substantial in some nations.

It doesn't take into account the quality of life of people living in a country. Even if GDP rises, people may still have a low standard of living, such as being unable to afford basic necessities, and their well-being may suffer as a result. It doesn't show how much wealth is produced in a country, only how much is sold. The country could be producing a lot but not selling it, resulting in a low GDP.

It disregards the environmental impact of production, including air and water pollution, deforestation, and other factors. These factors have an impact on the country's economic well-being but are not reflected in the GDP.

(b Gross Domestic Product (GDP) deflator and Consumer Price Index (CPI) are two important economic indicators that are used to calculate the level of inflation. The main difference between the two is that the CPI only takes into account the price changes of the goods and services that households purchase, while the GDP deflator includes all goods and services produced in a country, whether consumed domestically or exported. Here is a more detailed distinction:GDP deflator is a measure of the changes in the price level of goods and services included in GDP. It reflects changes in the overall price level of goods and services produced in the economy. It compares the value of goods and services produced in a given year to the value of those produced in the base year. This ratio is then multiplied by 100 to obtain the GDP deflator.

The Consumer Price Index (CPI) is a measure of the price changes of a representative basket of goods and services consumed by households. It is a weighted average of prices of a basket of goods and services purchased by households. The weight given to each item is determined by the relative importance of that item in the total expenditure of all the items in the basket. The CPI measures the changes in the cost of living of households over time and is frequently used to calculate inflation.

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