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madreJ [45]
2 years ago
7

Eric's income increased from $40,000 to $50,000 per year. Eric's consumption of tickets to pro football games increased from two

to four per year. By the midpoint formula, his income elasticity of demand for pro football game tickets is equal to _____, and football game tickets are _____ goods. –3; inferior –0.33; inferior +0.67; normal +3; normal
Business
1 answer:
ira [324]2 years ago
6 0

Answer:

By the midpoint formula, his income elasticity of demand for pro football game tickets is equal to <u>+3</u>, and football game tickets are <u>normal</u> goods.

Explanation:

The formula for calculating income elasticity of demand using the midpoint method is:

income elasticity of demand = {change in quantity demanded / [(old quantity + new quantity) / 2]} / {change in income / [(old income + new income) / 2]}

= {2 / [(2 + 4) / 2]} / {10,000 / [(40,000 + 50,000) / 2]} = (2 / 3) / (10,000 / 45,000) = 0.67 / 0.222 = 3

when the income elasticity of demand is higher than 1, the goods are normal goods.

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First National Bank (FNB) has a reserve ratio of 20 percent, a required reserve ratio of 10 percent, and deposits of $1,000. If
Vadim26 [7]

Answer:

The correct answer is then it has required reserves of $110 and holds excess reserves of $190.

Explanation:

According to the scenario, computation of the given data are as follows:

Total deposit = $1,000 + $100 = $1,100

So, we can calculate the total reserve required by using following formula:

Total reserve required = 10% × Total deposit

= 10% × $1,100 = $110

And Previous excess = $100

Current access = $90

So, Excess reserve =  Previous excess +  Current access

= $100 + $90

= $190

5 0
2 years ago
TLC Credit, Inc. has $35.0 million in consumer loans with an average interest rate of 12.0%. The bank also has $30.0 million in
MissTica

Answer:

$460,000 decrease

Explanation:

The computation of TLC's estimated change in revenues next year is shown below:-

TLC's estimated change in revenues next year = ((Consumer loan × Interest rate) + (Home equity loan × Interest rate) + (Corporate securities × Interest rate)) - ((Increased consumer loan × Decrease rate) + (Increase equity loan × Interest rate) + (Corporate securities × (1 - decreased percentage) × average interest rate))

= (($35.0 million × 0.12) + ($30.0 million × 0.O8) + ($5.0 million × 0.06)) - (($40.0 million × 0.10) +($32.0 million × 0.065) + (5 million × (1 - 20%)  × 0.09))

=$6,900,000 - $6,440,000

= $460,000 decrease

Therefore for computing the TLC's estimated change in revenues next year we simply applied the above formula.

6 0
2 years ago
Lisa surveyed a sample group of people. Based on her survey, Lisa suggested to her company that they develop a customizable trav
saw5 [17]
<h2>Answer:</h2><h3>To me i think that the answer is e) ad analysis </h3><h2>Explanation:</h2><h3>she was going around and survey a sample group of people. Then she suggested to her company about they develop a customizable travel application.</h3>
8 0
2 years ago
g Phoenix industries has pulled off a miraculous recovery. Four years ago it was near bankruptcy. Today, it was announced a $1 p
UNO [17]

Answer:

Market Share price $ 31,12

Explanation:

The price of the stock will be the same as the present value of their dividends:

Year        Dividend   Presnet Value

First year $1,00 $ 0,8621

Second   $2,00 $  1,7241

Third       $3,00 $  2,5862

Total Value         $  5,1724

Now, we solve for the horizon value

3 x (1.08) / (0.16 - 0.08) = 40,50

And, as this is three year ahead we also discounted like the other dividends:

\frac{Maturity}{(1 + rate)^{time} } = PV  

Maturity  40,50

time   3,00  

rate  0,16

\frac{40,5}{(1 + 0,16)^{3} } = PV  

PV   25,95  

And last, we add up the horizon with the other dividends:

5.17 + 25,95 = 31,12

3 0
2 years ago
Windsor Hospital purchases $90,000 in surgical equipment on October 1, Year 1. The useful life is estimated to be 5 years, and t
AVprozaik [17]

Answer:

The depreciation expense for year 1 is $16,000

Explanation:

Depreciation: The depreciation was occurred due to tear and wear, obsolesce, time period, etc

Under the straight-line method, the depreciation should be charged with the same amount over the useful life.

The calculation is shown below:

= \dfrac{(original\ cost - residual\ value)}{(useful \ life)}

= \dfrac{(\$90,000 - \$10,000)}{(5 \ years)}

= $16,000

The depreciation should be charged for $16,000 in year 1. Moreover, it is shown in the income statement in the debit side and in the cash flow statement also.

5 0
2 years ago
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