"Ginny sells bottled water from a small stand by the beach. On the last day of summer vacation, many people are on the beach, and Ginny realizes that she can make a lot more money this day if she hires someone to walk up and down the beach selling water. She finds a college student named Eric and makes him the following offer: They'll each sell water all day and split their earnings (revenue minus the cost of water) equally at the end of the day. Ginny knows that if they both work hard, Eric will earn $90 on the beach and Ginny will earn $180 at her stand, so they will each take home half of their total revenue: $90+$1802=$135 . If Eric shirks, he'll generate only $50 in earnings. Ginny does not know that Eric estimates his personal cost (or disutility) of working hard as opposed to shirking at $25."

Answers

Answer 1
Answer:

Answer:

Explanation:

Once out of Ginny sight, Alex faces a dilemma: Work very hard (put in all effort) or shirk (put in little effort). If he works hard, he'll sell enough water to generate $90 in earnings (not including his personal cost). If he shirks, he'll only generate $50 in earnings. After the end of the work, he'll split his earnings with Ginny and also get half of what she earns at her stand. In terms of Eric's total utility, it is worse for him to work hard. Close A If Alex works hard, Alex and Sunita together earn $270 ($180 + $90), of which Eric keeps $120. However, he loses $20 worth of utility by working hard. Therefore his net earnings is $100. If he shirks, Eric and Ginny together earn $270 ($200+ $70), of which Eric will keeps $120, while his personal cost is zero. Therefore Alex, individually, is better off when he shirks. A more better way of finding the solution to the problem is to note that from Eric's view, the amount of money he gets from Ginny's sales from the stand does not rely on his own sales.


Related Questions

A category of assets that typically has zero in the Free Assets column in a Statement of Affairs is:
The Refining Department of​ SweetBeet, Inc. had 74,000, tons of sugar to account for in July. Of the 74,000 ​tons, 42,000 tons were completed and transferred to the Boiling​ Department, and the remaining 32,000 tons were 60​% complete. The materials required for production are added at the beginning of the process. Conversion costs are added evenly throughout the refining process. The weightedminus−average method is used. Calculate the total equivalent units of production for direct materials.
The Skulls, a student social organization, has two different locations under consideration for constructing a new chapter house. The Skulls' president, a POM student, estimates that due to differing land costs, utility rates, etc., both fixed and variable costs would be different for each of the proposed sites, as follows LocationAnnual FixedVariableAlpha Ave.$5,000 $200per personBeta Blvd.$8,000 $150per person If it is estimated that 30 persons will be living in this new chapter house, which location should the Skulls select
Retail managers can use ________ to determine which inventory items require the most attention. a. EOQ modeling b. CPS scheduling c. Breakeven analysis d. ABC analysis
A $20,000 municipal bond is offered for sale at $18,000. The bond interest rate is 6 percent per year payable semiannually. The bond will mature and be redeemed at face value 5 years from now. If you purchase the bond, the first premium you will receive is 6 months from today. You have decided that you will invest $18,000 in the bond if your effective semi-annual yield is at least 4 percent. What effective semi-annual rate will this investment yield?

Assume this process continues, with each successive loan deposited into a checking account and no banks keeping any excess reserves. Under these assumptions, the $500,000 injection into the money supply results in an overall increase of ______ in demand deposits.

Answers

Answer:

$2,500,000

Explanation:

Following the stated assumptions in the question, the money multiplier will be used to calculate the resulting effect of the $500,000 injection into the money supply.

The money multiplier formula is 1/r , where r is the required reserve ratio. So, the resulting change in demand deposits is:

Change in Demand Deposits = Change in Fresh Reserves (that is, the Initial Deposit)×1/r

= $500,000×1/0.20

=$500,000 × 5

= $2,500,000

What is the most important thing to remember when writing a draft (apex) A. Use the spelling and grammar checks
B. Write quickly without over thinking
C. Write in phrases, not in sentences
D. Look for mistakes in subject-verb agreement

Answers

Write quickly without over thinking is the most important thing to remember when writing a draft.

Thus, the correct option is B.

What is a draft?

An initial version of a piece of writing or written document that is frequently reviewed before verification is referred to as a "draft."

A written order of payment from one party (the drawer) to another (the drawee) instructing them to pay a specific amount to a third party (the payee) on or before a specific date is an example.

You can rethink and rewrite your thoughts after you draft them by putting them on paper. You will be able to determine where further information and supporting proof are needed by doing this.

It will also help you determine whether the concepts you are providing appear logical and whether your argument is clear.

The full paper will be sent along with the final draft. Your writing ought to appear polished by the time you complete the final draft. Grammar and spelling mistakes, fragmented sentences, weak or nonexistent paragraph transitions, and other first draft flaws should all be eliminated.

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Answer:

B. Write quickly without over thinking

Explanation:

(APEX)

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To reduce its stock price, Shriver Food Systems, Inc., declared and issued a 100 percent stock dividend. The company has 860,000 shares authorized and 260,000 shares outstanding. The par value of the stock is $1 per share and the market value is $100 per share. Prepare the journal entry to record this large stock dividend. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

Answers

Answer:

Dr. Retained Earning                    $86,000,000

Cr. Common Stock                       $860,000

Cr. Paid-in-Capital excess of par $85,140,000

Explanation:

Stock dividend is the payment of dividend to stockholder in the form of stock/shares of the company. Stock are issued at the market price and the value of the dividend is transferred from the retained earning to the add-in-capital accounts.

Dividend Value = 860,000 x 100 = $86,000,000

Par Value of Stocks = $1 x 860,000 = $860,000

Add-in-capital excess of par common stock = ($100-$1) x 860,000 = $85,140,000

Final answer:

To record a large stock dividend, debit the Retained Earnings by the total market value of the dividend, then credit the Common Stock by the par value part, and credit the Paid-In Capital in Excess of Par by the remaining part.

Explanation:

To record a large stock dividend, you need to debit (decrease) Retained Earnings and credit (increase) Common Stock and Paid-in Capital in Excess of Par. Here's an example using Shriver Food Systems, Inc. data:

  1. Calculate the total market value of the dividend: 260,000 shares * $100 per share = $26,000,000
  2. Deduct the par value: $26,000,000 - (260,000 shares * $1 par value) = $25,740,000
  3. Make the journal entry: Debit Retained Earnings for $26,000,000. Credit Common Stock for $260,000 (this represents the par value). Credit Paid-In Capital in Excess of Par for $25,740,000 (this represents the remainder).  

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If one of your firm's customers is "stretching" its accounts payable, this may be a nuisance but it does not represent a real financial cost to your firm as long as the customer periodically pays off its entire balance. A. True B. False .

Answers

Answer:

False

Explanation:

If one of your firm's customers is "stretching" its accounts payable, this may be a nuisance but it does not represent a real financial cost to your firm as long as the customer periodically pays off its entire balance.

As a general rule, the Chinese government allows foreign companies to participate in its market only if those companies agree to establish operations with local Chinese enterprises. Which market entry mode would be the appropriate choice under these circumstances?

Answers

Answer:

A joint venture

Explanation:

A joint venture -

It refers to as the business agreement between two or more groups in order to attain a common goal collectively , is referred to as joint venture .

The parties comes together with their resources to accomplish the goal together .

The common project can be a new business or any existing business .

In a joint venture , the profit and loss is equally shared among each of the member  .

Hence , from the given scenario of the question ,

The correct answer is joint venture .

Answer:

Export minimum public procurement policy

Explanation:

'Chinese government allowing foreign companies to participate in its market only if those companies agree to establish operations with local Chinese enterprises' : illustrates the case of -  'Export minimum public procurement policy'

This is a policy adopted by various economies. The policy states that foreign companies should use a minimum level of inputs from their domestic medium & small scale enterprises. This is to create equitable growth opportunities for the MSMEs. As MSMEs are important by perspective of - regionally balanced growth, income equity, employment opportunities generation ; they need this protection.

The Dahlia Medical Center has 30 labor rooms, 15 combination labor and delivery rooms, and 3 delivery rooms. All of these facilities operate around the clock. Time spent in labor rooms varies from hours to days, with an average of about a day. The average delivery requires about one hour in a delivery room. The average time in a combination labor-delivery room is about 24 hours. During an exceptionally busy three-day period, 109 healthy babies were born at Dahlia Medical Center. Sixty babies were born in separate labor and delivery rooms, and 45 were born in combined labor and delivery rooms. Which of the facilities (labor rooms, combination labor and delivery rooms, or delivery rooms) had the greatest utilization rate?

Answers

Answer:

The combination Labour delivery room

Explanation:

Utilization refers to the degree by which available resource                                                                

is being used.

It is given by the ratio of total input to total output

The attached file shows a complete solution

Final answer:

Over a three day period, the combined labor and delivery rooms at Dahlia Medical Center had the greatest utilization rate given the number of rooms and babies born.

Explanation:

In order to determine facility utilization rate, we must consider how many babies were born in each type of room, the number of each type of room available, and the time period in question. In this case, the time span is three days. There were 60 babies born in separate labor and delivery rooms, 45 were born in combined labor and delivery rooms, and the remaining 4 babies (109-105) were presumably born in one of the 3 dedicated delivery rooms.

For the labor rooms, the utilization rate calculates as (60 babies/30 rooms)/3 days = 0.67. For the combined labor and delivery rooms, it is (45 babies/15 rooms)/3 days = 1. For the delivery rooms, we deduce that 4 babies were born so the calculation will be (4 babies/3 rooms)/3 days = 0.44.

Therefore, the combined laborand delivery rooms had the greatest utilization rate over the three day period.

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Other Questions
Your company assembles five different models of a motor scooter that is sold in specialty stores in the United States. The company uses the same engine for all five models. You have been given the assignment of choosing a supplier for these engines for the coming year. Due to the size of your warehouse and other administrative restrictions, you must order the engines in lot sizes of 1,000 units. Because of the unique characteristics of the engine, special tooling is needed during the manufacturing process for which you agree to reimburse the supplier. Your assistant has obtained quotes from two reliable engine suppliers and you need to decide which to use. The following data have been collected:Requirements (annual forecast) 12,000 unitsWeight per engine 22 poundsOrder processing cost $125 per orderInventory carry cost 20 percent of the average value of inventory per yearAssume that half of lot size is in inventory on average (1,000/2 = 500 units).Two qualified suppliers have submitted the following quotations:ORDER QUANTITY SUPPLIER 1 UNIT PRICE SUPPLIER 2 UNIT PRICE1 to 1,499 units/order $510.00 $505.001,500 to 2,999 units/order 500.00 505.003,000 + units/order 490.00 488.00Tooling costs $22,000 $20,000Distance 125 miles 100 milesYour assistant has obtained the following freight rates from your carrier:Truckload (40.000 lbs. each load): $0.80 per ton-mileLess-than-truckload: $1.20 per ton-mileRequired:a. Calculate the total cost for each supplier.b. Which supplier would you select?c. If you could move the lot size up to ship in truckload quantities, calculate the total cost for each supplier.d. Would your supplier selection change?