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Trade Agreements

Trade Credit

The Thompson corporation projects an increase in sales from $1.5 million to $2 milliion, but needs an additional $300,000 of current assets to support this expansion. Thompson can finance the expansion by no longer taking discounts, thus increasing accounts payable.Thompson purchases under terms of 2/10, net 30, but it can del

NATIONAL ECONOMY

Which of the following is the BEST indicator of the performance of the national economy? 1. The federal government budget deficit 2. The stock of capital goods (machinery) in the nation 3. The size of the nation's stock of money 4. The balance of trade with other nations 5. The flow of new goods and services produ

Coase theorem

Bob and Dexter share a dorm room. Bob is a smoker but Dexter does not smoke. There are no laws that prohibit smoking in the dorm rooms. The benefit of smoking is worth $250 to Bob, but the smoke imposes a $500 cost on Dexter. How might the Coase theorem be used to achieve an efficient outcome in this situation? Be sure to d

Nominal Cost of Nonfree Trade Credit

Calculate the nominal cost of nonfree trade credit under each of the following terms. Assume payment is made either on the due date or on the discount date. a. 1/15, net 20 b. 2/10, net 60 c. 3/10, net 45 d. 2/10, net 45 e. 2/15, net 40.

Stock valuation after a split

From an accounting standpoint, stock splits neither add nor detract from the intrinsic value of the stock. For example, if stock was $100,paying a $2.50 dividend and underwent a 2:1 split, the $100 stock becomes two $50 stocks each paying a dividend of $1.25. However, the market often bids up the stock price upon stock splits. P

There are many significant antitrust cases in the United States.

There are many significant antitrust cases in the United States. The most significant cases involve firms such as Microsoft, AT&T, Standard Oil, and Major League Baseball. A professor at St. Olaf College and established a website that is a good resource for a list of antitrust cases: The Antitrust Case Browser Take a few m

The Leontief paradox factors

If factor-intensity reversals were indeed prevalent in the real world, how might this fact be used to explain the Leontief paradox? If this explained the paradox, would it suggest that any given U.S. trading partner stood a better chance of conforming to Heckscher-Ohlin than did the United States (i.e., will a factor intensity r

Suppose that, from an initial equilibrium position in the offer curve diagram, country I imposes a tariff on country II's export good at the same time that consumers in country II change their tastes toward wanting more of II's export good.

Suppose that, from an initial equilibrium position in the offer curve diagram, country I imposes a tariff on country II's export good at the same time that consumers in country II change their tastes toward wanting more of II's export good. Illustrate and explain the impact of these two simultaneous events on country I's volume

What is a free trade agreement?

What is a free trade agreement? What are the economic objectives the US sees to accomplish by signing a free trade agreement (FTA)? What are 2 FTA's the US currently belongs to?

Rich High Wage Country Expanded Trade with Lower Wage Country

It is argued that if a rich high wage country such as the United States were to expand trade with a relatively lower wage country such as Mexico, the U.S. industry would migrate south, and U.S. wages would fall to the level of Mexico's. What is your opinion about this argument?

Budgetary control and responsibility

National Products Corporation participates in a highly competitive industry. In order to meet this competition and achieve profit goals, the company has chosen the decentralized form of organization. Each manager of a decentralized investment center is measured on the basis of profit contribution, market penetration, and return

Inventory Cost Problem and a Cash Balance Problem

I need help with these two homework problems...could you provide a step by step solution so that I may understand the concepts? P7-1 (Determine Proper Cash Balance) Dumaine Equipment Co. closes its books regularly on December 31, but at the end of 2007 it held its cash book open so that a more favorable balance sheet could

Incremental analysis

Mesa Industrial Products Co. (MIPC) is a diversified industrial-cleaner processing company. The company's Verde plant produces two products: a table cleaner and a floor cleaner from a common set of chemical inputs (CDG). Each week 900,000 ounces of chemical input are processed at a cost of $210,000 into 600,000 ounces of floor c

Industry Structure of Amazon and Wal-Mart

Please help answer two questions that relate to the attached article. Each question should be at least 2 to 3 paragraphs. Questions: 1.What type of industry structure do Wal-Mart and Amazon inhabit? Is there behavior (cutting prices to below cost) conform to the theoretical expectations for that industry structure? 2.Wha

Calculated EPS

Problem Given Best Travel organizes virtual travel tours, is planning an IPO. Its current investors hold 300,000 shares, which at IPO will be converted into common shares at 1:1 ratio. The company competes with the following publicly traded companies: CoachTraveler, VirtualExplor

General

Explain how the Internet will continue to change foreign trade?

Chinese firms and trade means

What about China... A stronger yuan would be associated with a higher standard of living in China. Chinese firms would receive a higher price (in yuan terms) for exports, while consumers and businesses in China would pay less for imports. Goods for the US and the world economy....This improvement in the terms of trade means

Trade

Briefly explain what are three reasons why economists' and laypeople's view of trade differ?

Supply: Production, Costs, and Profits

Focusing on the production of a country other than the United States. For example Canada. Please answer the following questions: 1. What it is so important about this Country? 2. What is interesting about this Country? 3. What are some facts about this country (population, GDP, etc.)? 4. What is currently go

Efficient market hypothesis: Example problem

Can you please explain the meaning of efficient markets. Why might we expect markets to be efficient most of the time? In resent years, several securities firms have been guilty of using inside information when purchasing securities, thereby achieving returns well above the norm (even when accounting for risk). Does this suggest

Securities

Consider two securities that pay risk-free cash flows over the next two years and that have the current market prices shown here: Security Price Today ($) Cash Flow Cash Flow in One Year ($) in Two Years ($) _________________________________________________________

Stock

In 1996, Kodak paid a cash dividend of $1.60 per share. At year-end 1996, Kodak shares were trading at about $80 per share. Between 1997 and 2001, Kodak paid $1.76, and in 2002 raised its dividend to $1.80. Yet, despite the stable dividend payout, the price of Kodak stock steadily fell, reaching $27 in 2003. At that time, th

Equity Capital

Scenario: A company has issued convertible preferred stock to its venture investors. Each share of preferred stock is convertible into 0.75 shares of common stock and pays an annual cash dividend of $0.13. Your tasks: 1. If each share of preferred stock sells for a market value of $7, what's the lowest price that a share of t

US recession and reduction of US trade deficit

How can I explain why a U.S. recession that occurs as the rest of the world is expanding will tend to reduce the U.S. trade deficit?. This does not make sense to me at all. Can someone please explain this to me, Thank You!

NAFTA

I am an advisor to the US Federal Trade Administration in charge of doing background research that will be used for trade negotiations by policy makers. The US is in the process of engaging in negotiations with countries in Middle and South America to explore expansion of the North American Free Trade Agreement [NAFTA]. I ha