when would arbitration be a preferred way to resolve a dispute or negotiations impasse? please explain your answer.

Answers

Answer 1

Unlike a trial, arbitration leads to a private resolution, so the information brought up in the dispute and resolution can be kept confidential.

What is the meaning of arbitration?

A dispute can be resolved through arbitration instead of going to court. The person you are filing a claim against is the respondent, and you are the claimant. An impartial party known as an arbitrator hears your two cases.

Arbitration a sign of a deal?

Instead of going to court, a dispute can be resolved through arbitration by a neutral third party. Both parties rely on the arbitrator, an impartial person or panel, to render an appropriate conclusion in light of the case's facts. An arbitration award is the name given to the final ruling.

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Related Questions

a real estate investment is available at an initial cash outlay of $100,000, and is expected to yield cash flows of $33,438.10 per year for five years. the internal rate of return (irr) is approximately:

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An investment in real estate is accessible for a $100,000 initial cash outlay and is predicted to generate $33,438.10 in cash flows over the course of five years. About 20% is the internal rate of return (irr).

Describe real estate.

Real estate is defined as the land and any affixed permanent structures, such as a house, or improvements, whether created naturally or artificially. Real property includes real estate.

Real estate includes land, the houses on it, and any natural resources such as crops, minerals, or water. It also includes immovable property of this kind, such as houses or other housing that meets common definitions of real estate.

Real property includes tangible personal property, which is something you own that is tied to a piece of land. It often comprises of any assets on the property, including water or minerals, and is suitable for residential, commercial, or industrial uses.

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scrum uses a series of coordinated meetings to manage the development process. during which of the following is it discussed what was done since the last meeting, what will be done before the next meeting, and if anything is limiting performance?

Answers

If during which of the following is it discussed what was done since the last meeting, the thing that will be done before the next meeting, and if anything is limiting performance is: A. Daily Scrum meeting.

What is Daily Scrum meeting?

Daily Scrum meeting can be defined as the type of meeting that is organized  so as to improve team development and to develop a plan that will be used to successfully achieve organizational goals and objectives.

Daily scrum meeting can help to identify issues or challenges that a company is facing  as well as how to combat the issues.

Therefore the correct option is A.

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The complete question is:

Scrum uses a series of coordinated meetings to manage the development process. During which of the following is it discussed what was done since the last meeting, what will be done before the next meeting, and if anything is limiting performance?

Daily Scrum meeting

Sprint review meeting

Sprint retrospective meeting

Sprint planning meeting

Release planning meeting

suppose hondurans began purchasing real assets in the united states. how would this impact the foreign exchange market for the lempira and the dollar price of the lempira? demand for lempira / dollar price of lempira

Answers

Effect the lempira's foreign currency market and its exchange rate against the dollar Demand for lempira and its monetary cost are Decrease/Decrease

Explain about the lempira?

The Lencas were an indigenous tribe in Honduras, and Lempira was their chief. Lempira brought together many native tribes in 1537–1538 to form an army that fought the Spanish conquerors as a single force.

In the 1530s, Lempira, a warrior chieftain of the Lencas in western Honduras, led the Lenca resistance against Francisco de Montejo's attempts to conquer and annexe the area into the province of Honduras.

A 16th-century national hero serves as the inspiration for the name of the Honduran Lempira. Lempira, the head of the Lenca tribe, led a vain attempt by the local natives to repel the soldiers of the Spanish conquistadors.

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assume that a futures contract on treasury bonds with a face value of $100,000 is purchased at 93-00. if the same contract is later sold at 94-18, what is the gain, ignoring transaction costs?

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Assume that a futures contract on treasury bonds with a face value of $100,000 is purchased at 93-00. If the same contract is later sold at 94-18, the gain, ignoring transaction costs is $1,562.50.

To calculate gain and loss on a trade -

multiply the dollar value of a one-tick move by the number of ticks the futures contract has moved since you purchased the contract.

The inventory costing method used by a corporation determines the amount of the cost of products sold. First in, first out (FIFO), last in, first out (LIFO), and the average cost method are the three techniques a business might use to record the amount of inventory sold during a period. When identifying expensive or rare artefacts, a particular procedure is used.

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once an individual is appointed to the securities and exchange commission (sec), for how long does she serve?

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An individual serves on the the Securities but when Exchange Board for five years after being appointed to the position.

What kind of exchange is that?

A brief, tense conversation that can last simply a few phrases. The exchanges between the two sides have occasionally been tense. An exchange of fire, for example, occurs when individuals fire weapons or mortars at one another. Trade in the open market, distribution, and reciprocity are these.

What is the process of exchange?

An exchange is where stocks, bonds, metals, swaps, contracts, and other securities are traded. Public exchanges ensure fair transactions between buyers and sellers by providing information around transaction records, top bid, ask prices, or financial velocity.

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all of the following are key cost items in the purchase of a new car EXCEPT

a. rebates
b. sales tax
c. down payment
d. lease terms

Answers

Answer:

A. Rebates

Explanation:

the answer is Rebates

factors affecting the span of management include all of the following except: authority of the manager. organizational policies. nature of the work being completed. competency of workers.

Answers

Uncontrollable costs, even as name suggests, are expenses that management cannot influence.

What part does management play?

A management position in an organisation entails accountability and oversight. Depending on the job titles as well as the needs of the business, they contribute in their companies in a variety of ways. Managers serve a variety of functions in the context of their work, from project managers to department managers.

What does the term "management" mean?

The process of completing the labour or task necessary for accomplishing an organisation's goals in an effective and efficient way is referred to as management. The procedure implies the management duties. Planning, organizing, staffing, leading, and managing are therefore involved.

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Which of the following is a tax on imported goods or products?

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A tariff is a tax imposed by government of one country on the goods and services imported from another country. Therefore, the correct option is 4th.

Tariff is imposed majorly to protect the domestic producers, but the government also imposes tariffs to reduce imports from other countries, thereby promoting the use of domestic products. Besides being a source of revenue for the government, import duties can also be a form of regulation of foreign trade and policy that taxes foreign products to encourage or safeguard domestic industry. Some of the benefits of imposing tariffs are:

Protection to producers.Preserve national security.Reduction of innovation.Avoiding unemployment.  

 Tariffs should be imposed by the government when there is a potential threat or harm to domestic manufacturers or based on requests. The importing firm pays tariffs to the country's government where the goods are imported.

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The complete question would be: Which of the following is a tax imposed on the imported goods or products?

SubsidyQuota EmbargoTariff  

Wherein, a subsidy is a monetary gift from the government. A quota is an amount of something. An embargo is a ban on trade with a country.

performance appraisals are part of control. a. inventory b. physical c. financial d. information e. human resources

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The performance appraisals are part of control is human resources.

What is meant by human resources?The group of individuals who work for a given organisation, business sector, industry, or economy is referred to as its human resources. Human capital, or the knowledge and abilities that people possess, is a more specific idea. Manpower, labour, personnel, colleagues, or simply "people" are comparable concepts. Employees are hired, screened, and interviewed by human resources specialists, who also assign newly hired workers to positions.They could also be in charge of training, employee relations, and salary and benefits. Labor relations experts administer and interpret labour contracts. The individual or team in charge of overseeing everything linked to a company's personnel is known as human resources. This includes, but is not limited to, recruiting, benefit management, employee happiness, establishing a business culture, and training new personnel.

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the equity interest in a subsidiary not attributable directly or indirectly to the parent is known as the (select all that apply)

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The equity interest in a subsidiary not attributable directly or indirectly to the parent are Non-Controlling Interest and Minority Interest.

What is equity interest?

Equity interest is an ownership interest in a company. It is a form of security that gives the holder the right to vote on certain matters, such as the election of directors and the approval of major corporate actions. Equity interest also provides a right to receive a share of the company’s profits, either through dividends, or through an increase in the value of the shares when they are sold. Equity interest is typically obtained by purchasing shares of stock in the company, either through a public offering or through private transactions.

Non-Controlling Interest and Minority Interest are correct answers. Non-Controlling Interest and Minority Interest refers to the equity interest that is not held by the parent company in a subsidiary. This equity interest is held by other investors or shareholders, such as individual shareholders or institutional investors.

Hence, Non-Controlling Interest and Minority Interest are the answers.

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a silver futures contract requires the seller to deliver 5,000 troy ounces of silver. an investor sells one april silver futures contract at a price of $15 per ounce, posting an $8,400 initial margin. if the required maintenance margin is $6,900, the price per ounce at which the investor would first receive a maintenance margin call is closest to:

Answers

The investor would first receive a maintenance margin call is closest to

15.3

How to Calculate Margin call?

Increase in price per ounce=Number of ounces-Required margin maintance/Initial margin

=8400-6900/5000

=0.3

Future price =Selling price per ounce + Increase in price per ounce

=15+.3

=15.3

Initial Purchase Price x [(1 - Initial Margin) / (1 - Maintenance Margin)] = Margin Call Price. The margin call price serves as a benchmark for the price below which the margin requirements are not satisfied, forcing the investor to make more deposits or sell off a certain portion of their portfolio assets in order to comply.The investor can deposit cash in the amount of the margin call to cover it. As an alternative, the investor can sell sufficient securities to satisfy the margin need with the remaining equity. Let's say the investor does not want to add to the $2,000 cash balance in the account.

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a total of 8000 is invested in two funds paying an annual interest of 4% and 5%. the combined annual interest is 350%. how much of the $8000 was invested in each fund?

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Let x be the quantity invested at 4% annual hobby and y be the amount invested at 5% interest. The sum of all the investments is $8000. The complete yield from the two investments is $350. Thus, the first investment is $5000 whilst the 2nd investment is $3000.

What is annual interest

The annual pastime charge refers to the charge that is utilized over a period of one year. Interest prices can be utilized over special periods, such as monthly, quarterly, or bi-annually. However, in most cases, activity charges are annualized.

How do you calculate annual interest?

The formula and calculations are as follows: Effective annual interest charge = (1 + (nominal rate ÷ quantity of compounding periods)) ^ (number of compounding periods) - 1. For investment A, this would be: 10.47% = (1 + (10% ÷ 12)) ^ 12 - 1.

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Which of the following statements describes the media's role in the self-regulation of advertising?
A. The media must accept all the advertising campaigns they receive because of the First Amendment that guarantees the freedom of speech.
B. The media cannot refuse to accept advertising for an entire product class such as hard liquor.
C. The media can refuse to accept individual ads they find offensive or objectionable.
D. The media is expected to reject ads that are targeted toward children and older adults.
E. The broadcast is required by law to reject political ads.

Answers

The option that describes the media's role in the self-regulation of advertising is The media can refuse to accept individual ads they find offensive or objectionable. Option C

What is meant by advertising?

A marketing strategy known as advertising involves purchasing real estate to advertise a good, bad, or intangible idea. Ads, as they are often known, are the real advertising messaging. Reaching the demographics most likely to be interested in purchasing a company's goods or services is the aim of advertising.

An advertising, sometimes referred to as an advert or ad, is typically seen as a kind of public discourse that supports a good, service, organization, or event. Some people may view the phrase as going much farther than that, encompassing any type of sponsored advertising intended to enlighten or persuade. Advertisements are messages that are sent and paid for by their senders with the intention of informing or influencing the recipients.

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True or False?

A true market segment meets all of the following criteria:

it is distinct from other segments (different segments have different needs),

it is homogeneous within the segment (exhibits common needs),

it responds similarly to a market stimulus, and it can be reached by a market intervention

Answers

It is TRUE to state that a true market segment meets all of the following criteria:

it is distinct from other segments (different segments have different needs),it is homogeneous within the segment (exhibits common needs),it responds similarly to a market stimulus, and it can be reached by a market intervention.

What is a market segment?

Market segmentation is the process of breaking a large consumer or company market, often made up of present and future customers, into sub-groups of consumers based on some form of the shared trait.

Segmentation allows you to understand more about your audience and personalize your messaging to their tastes and requirements. Targeting a specific section of people who are likely to be interested in your content or product is far more successful than targeting a large number of people.

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consider the demand for cereal. when price is $4.25/box quantity demanded is 1200 boxes. price increased to $5.25/box and quantity demanded fell to 1000 boxes. what is the elasticity of demand?

Answers

Demand is considered to be relatively inelastic, or not highly responsive to price changes, if the quantity demanded is smaller than the percent change in price.

What does demand look like?

Key Learnings. According to the economic principle known as the law of demand, customer demand for just a good increases when prices are low and decreases when prices are high. When shoppers rush to purchase goods at steep prices during Black Friday bargains, the law of demand is in effect.

Is a demand a request?

It might be simple—and tempting—to employ demands rather than requests, even if you believe you comprehend the distinction on an intellectual level. A request is when you formally, politely, or respectfully ask for something. A call is a strong declaration in which you request something.

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chad watched as his friend, ned, learned the hard way that some influence tactics generate resistance. the employees pay little or no attention to what ned has requested of them. chad has a major project for his team. it needs to be completed on time, on budget. ned suggests using pressure tactics, but which influence tactic do you think chad should use?

Answers

Since research has shown that adopting the inspirational appeal influence method increases the likelihood that a commitment will be made, Chad should employ it.

An inspirational appeal is what?

Inspirational appeals, a type of appeal meant to inspire passion or feeling. Someone is employing inspirational appeal when they pique your interest in a subject by speaking to your values, aspirations, or goals.

What three different influencing strategies are there?

The most successful influence strategies among these were discovered to be inspirational appeal, consultation, and logical appeal (with inspiration appeal being the strongest successful of the three), whereas coalition and pressure were discovered to be the least successful strategies.

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which of the following can be considered a secondary stakeholder in a crisis? group of answer choices a. employees b. unions c. media d. suppliers

Answers

Media among the following can be considered a secondary stakeholder in a crisis.

Who exactly are the secondary stakeholders?

Supplementary stakeholder, The people, organizations, or entities that have an interest in how a company conducts its social business are known as secondary stakeholders. Secondary stakeholders typically don't have direct access to an organization's financial operations.

How do primary and secondary stakeholders differ?

While secondary stakeholders have an indirect link with or benefit from your organization, primary stakeholders are those who have a direct interest in it. Your company will continuously reassert its relevance if you have clear, succinct plans for how to target each of your major stakeholder categories.

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Employees usually do not reflect much concerning a decision to quit; rather, quitting is in response to immediate events.

a. True
b. False

Answers

The statement is false. Employees usually do not reflect much concerning a decision to quit; rather, quitting is in response to immediate events.

An employee is a person who has agreed to be employed to paint for a few shapes of fee below an agreement of employment. Your employment popularity will assist define what rights and responsibilities you have got at paintings. There are three fundamental varieties of employment popularity: employee.

Before hiring a new team member, it is crucial to apprehend your options in regard to special kinds of employees. research the main variations among complete-time, part-time, seasonal, and brief personnel. Any person who strives hard to accomplish the desires and goals of a specific employer is called an employee. personnel is employed to carry out particular obligations as per their specialization, hobby regions, and former stories.

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Which type of intellectual property can protect your company's logo? a. a dba name b. patent c. copyright d. trademark please select the best answer from the choices provided a b c d

Answers

Trademark is a  type of intellectual property that can protect your company's logo

Option D is correct.

What trademark implies?

Any word, phrase, symbol, design, or combination of these that identifies your products or services is considered a trademark. It is how customers distinguish you from your rivals and recognize you in the market. Trademarks and service marks can both be referred to as "trademarks."

Words, phrases, symbols, and logos that identify a company's goods or services can be protected by trademarks. A trademark registration must be renewed every ten years, but it can last forever as long as it is used in business. Because of this, the trademark is one of the most important IP safeguards for businesses.

What are the four types of intellectual property?

The company's patents, trademarks, copyrights, and trade secrets are valuable assets that must be safeguarded by knowing how they function and are made.

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if you were an economist for a firm that wanted to merge, would you argue that the three-digit or five-digit naics industry is the relevant market? why?

Answers

The relevant market is a three-digit naics economist for a company that desired to merge.

What does industry NAICS code mean?

The United States, Canada, and Mexico classify enterprises by industry using the North American Industry Classification System (NAICS). The following are some usage of VTA's Vendor Portal and other systems for the NAICS business code system: Sort the requests for proposals that are posted on its vendor portal.

A three-digit SIC code is what?

The major industry group is identified by the first two digits of the SIC code, the industry group is identified by the third digit, and the individual industry is identified by the fourth digit. A significant government organization that controls the markets is the Securities and Exchange Commission (SEC). SIC codes are still used by the SEC.

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The concept of _________________ means that as the measure of output goes up, average costs of production decline—at least up to a point.
relative advantage
economies of scale
absolute advantage
comparative advantage

Answers

The concept of economies of scale means that as the measure of output goes up, average costs of production decline—at least up to a point.

Therefore, option B is correct.

Economies of scale  can be described as a concept in economics which can be regarded as the cost advantages that enterprises obtain due to their scale of operation, and are typically measured by the amount of output produced per unit of time.

It should be noted that internal and external economies of scale are distinguished. Internal economies of scale are reached when a corporation expands production while lowering costs. Outside of a company, external economies of scale exist within an industry.

Thus, external economies of scale may occur when an industry's operational range increases as a result of outside innovations. For instance, a company's costs as well as those of its industry may go down as a result of the development of a stronger transportation network. All businesses within the industry profit when external economies of scale take place.

Therefore, option B is correct.

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jonas has disability insurance through his employer. the employer pays 75% of the premium, and jonas pays the other 25%. what is jonas tax liability for any benefits paid from the disability

Answers

Jonas has disability insurance through his employer. Jonas's tax liability for any benefits paid from the disability takes must be paid on 75% of the benefits received.

Insurance is a contract whereby one insurer indemnifies another insurer against losses arising from certain contingencies or perils. Help protect the insured or her family from financial loss. There are many types of insurance policies.

Cover running costs and larger expenses such as your mortgage while you focus on your health and recovery. Cover medical expenses such as prescription drugs, dental care, eye care, and other health-related items.

Life insurance helps survivors financially. Health insurance protects you from devastating claims in the event of a serious accident or illness. A permanent disability protects you from an unexpected loss of income. Auto insurance protects you from the financial burden of expensive accidents.

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kasey is 72 years old. she purchased a single life annuity contract that will pay her $10,000 per year for 15 years. the expected return under the contract is:

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Kasey is 72 years old, she purchased a single life annuity contract that will pay her $10,000 per year for 15 years, the expected return under the contract is $264,000.

By contract, what did you mean?

An agreement between parties that establishes legal duties for both parties is known as a contract. Mutual consent, demonstrated by a valid offer and acceptance, sufficient consideration, capability, and legality are the fundamental components needed for the agreement to be a legally enforceable contract.

Contract with example: What is it?

A commitment made by one party to another that they will or won't take a particular action in the future. As an illustration, I'll offer you $3,500 to buy your car. An acceptance. Usually reflects the conditions of the offer—an indication, through speech or action, that both parties accept the terms of the contract.

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you purchased butterfly wing corporation stock exactly one year ago at a price of $77.95 per share. over the past year, the stock paid dividends of $2.98 per share. today, you sold your stock and earned a total return of 15.95 percent. what was the price at which you sold the stock?

Answers

The price at which you sold the stock is $88.50; Dividend yield = dividends paid / beginning share value = 4.01%; Capital gain yield: 0.1628 = 0.04 + g, g = 0.1128.
Current share price = beginning share price x (1 + g) = 88.50

A dividend is a benefit given to shareholders by publicly traded firms, and it is funded by the latter's net profit. These incentives, which can take the form of cash, cash equivalents, shares, etc., are often provided from the remaining portion of earnings after all necessary expenses have been covered. The board of directors of a firm determines the dividend rate, taking into account the consent of the majority of shareholders.

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when a firm merges with a company that does not produce inputs it needs to make its products or does not sell similar finished goods and services, it is called a

Answers

A conglomerate merger occurs when a company joins forces with another that neither produces the raw materials it needs to build its products nor offers comparable finished goods and services.

Which describes a horizontal merger the best?

A horizontal merger is a merger or corporate restructuring involving businesses in the same sector. Because there is typically more competition among businesses in the same industry, combining businesses can result in significantly bigger synergies and possible market share gains.

Which of the following merger types is prohibited by antitrust law?

Proposed mergers between direct competitors offer the most antitrust danger (horizontal mergers).

Of the following, which one has the authority to approve or reject a merger?

Before a significant merger occurs, the antitrust authorities at the FTC and the US Department of Justice can approve the merger, forbid it, or approve it if specific requirements are met. One typical requirement is that the company agree to sell off specific components before the merger is approved.

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a prior period adjustment should be reported as an adjustment to the retained earnings balance at the beginning of the period in which the adjustment was made. true false

Answers

a prior period adjustment should be reported as an adjustment to the retained earnings balance at the beginning of the period in which the adjustment was made- false.

What is retained earnings?

The retained earnings (also known as plowback[1]) of a corporation is the accumulated net income of the corporation that is retained by the corporation at a particular point of time, such as at the end of the reporting period. At the end of that period, the net income (or net loss) at that point is transferred from the Profit and Loss Account to the retained earnings account. If the balance of the retained earnings account is negative it may be called accumulated losses, retained losses or accumulated deficit, or similar terminology. Any part of a credit balance in the account can be capitalised, by the issue of bonus shares, and the balance is available for distribution of dividends to shareholders.

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questionable business practices according to antitrust agencies complete the following table by matching each of the scenarios to the concept of resale price maintenance, predatory pricing, or tying. scenario resale price maintenance predatory pricing tying rightround sells a wide variety of records to retail record stores. rightround recently pressed two new records: a popular pop punk album and a much less popular smooth jazz album. rightround requires record stores to order 15 copies of the smooth jazz album for every 120 copies of the pop punk album bought. citron is a firm that manufactures electric scooters. suppose citron sells its electric scooters to online retailers for $900 each and requires those online retailers to charge at least $930 to shoppers for each electric scooter. breezy hut is the only firm producing air conditioners. it costs $950 to produce one air conditioner, and breezy hut sells each air conditioner for $1,200. after gregale, a new firm with the same costs as breezy hut, enters the market for air conditioners, breezy hut starts selling its air conditioners for a price of $600. true or false: all economists believe that predatory pricing is a profitable business strategy. true false

Answers

a. Snackyville ties 10 cases of granola bar for every 130 cases of trail mix ordered. So, this is the case of tying.

b. Cubit reduces the price of cubicles below its cost of production after the entry of In Square. This is the case of Predatory Pricing strategy followed to prevent other firm's entry in the market.

C. Talkie Time sets the price that retailers have to charge from customers. This is the case of RESALE PRICE MAINTENANCE.

d. Resale Maintenance price is to reduce competition in price. But, it is not economically inefficient.

Thus, the statement is FALSE.

What is strategy?

A strategy is a broad plan to accomplish one or more overarching, long-term objectives in the face of uncertainty. The term "art of the general" first appeared in use in 6th century C.E. Eastern Roman terminology, and it wasn't until the 18th century that it was translated into Western vernacular languages. This "art of the general" concept included a number of subsets of skills, such as military tactics, siegecraft, logistics, etc. From that point on until the 20th century, the term "strategy" developed to mean "a comprehensive means to try to attain political aims, including the threat or actual use of force, in a dialectic of wills" in a military battle, in which both opponents cooperate.

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Question: Questionable business practices according to antitrust agencies

Due to the Taxpayer Relief Act of 1997, it may not be necessary to file which of the following on a capital gain on residential property?
A)
Form 1099-S
B)
None of these
C)
Form W2
D)
Form 1099-TR

Answers

The Taxpayer Relief Act of 1997 made it so that capital gains were not subject to filing Form 1099-S.

What is the 1997 Taxpayer Relief Act?

For taxable years beginning after December 31, 1997, the Taxpayer Relief Act of 1997, Title I: Child Tax Credit, amends the Internal Revenue Code (IRC) to permit a tax credit of up to $500 for each eligible child of a taxpayer.

In the United States, a number of federal taxes were decreased under the Taxpayer Relief Act of 1997. A $400 tax credit for every child under the age of 17 was introduced in 1998, and it was later raised to $500 in 1999. For high-income households, this credit was gradually eliminated.

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what international organization runs a dispute settlement process in which countries can resolve trade inequalities in a formal arena?

Answers

Countries can settle trade disparities in a formal setting through the World Trade Organization's (WTO) dispute resolution procedure.

Describe trade.

Trade is the voluntary transfer of goods or services among participants in the economy. Trade is often seen to be beneficial to both parties because interactions are voluntary. Buying and selling share or other assets is referred to as trading in the finance industry.

Why is trade so important?

Because it fosters economic growth, encourages domestic employment, enhances standard of living, and give more control to support their families with fairly priced goods and services, trade is crucial to the success of the United States. More jobs, greater pay, quality services, moderate inflation, and a propensity for cooperative over conflict are all advantages of increased commerce. nation. The much more freely trade goes around the world, the bigger the wave of economic success and peace will be.

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one-year rate in japan is 4% and one-year rate in the u.s. is 2%. the current exchange rate is 110 yen per dollar. if you can enter into a forward exchange rate of 120 yen per dollar, what would be your arbitrage profit per 100 units of the borrowed currency? assume that you can borrow and lend at the given interest rates.

Answers

Your arbitrage profit per 100 units of the borrowed currency makes a riskless profit of 0.02 dollars.

The first thing to do is figure out what the correct forward rate should be.

The forward rate should be (110×1.04)/1.02 = 112.15 yen/dollar.

Thus you want to exchange yen for dollars at 110 rather than the implied 112.15.

If you start with no money then you need to borrow 1 dollar at 2% exchange them into 110 yen and invest the yen at 4%.

The yen will grow to be 110×1.04 = 114.4

so you enter into a forward exchange agreement to exchange

114.4 yen into dollars at an exchange rate of 110.

This will yield 1.04 dollars.

You need to repay your dollar borrowing which will cost 1.02 dollars.

Thus you make a riskless profit of 0.02 dollars.

In economics and finance, arbitrage is the exercise of taking benefit of a distinction in fees in two or greater markets; placing an aggregate of matching offers to capitalize on the difference, the profit being the distinction among the market expenses at which the unit is traded.

Whilst used by lecturers, an arbitrage is a transaction that includes no bad cash going with the flow at any probabilistic or temporal country and tremendous cash going with the flow in at least one kingdom; in easy phrases, it's far the opportunity of threat-free earnings after transaction charges. As an example, an arbitrage possibility is present whilst there may be the opportunity to instantly purchase something for an extremely low fee and sell it for a better price.

Arbitrage is the simultaneous buying and sale of equal or comparable assets in unique markets in order to take advantage of tiny differences in the asset's listed rate. It exploits short-lived versions inside the rate of the same or similar economic units in different markets or in special forms.

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