After the implementation of the North American Free Trade Agreement (NAFTA), the United States reduces its tariff on Mexican tortillas from 25% to 0. While the price of tortillas in the United States is expected to fall after the tariff reduction, it may not decrease by the exact amount of the tariff. The actual price reduction will depend on various market factors and conditions.
Tariffs are taxes imposed on imported goods, which increase the price of those goods for consumers. When a tariff is reduced or eliminated, it typically leads to a decrease in the price of imported goods. However, the exact price reduction may not necessarily be equal to the tariff rate.
In this case, when the U.S. tariff on Mexican tortillas decreases from 25% to 0, the price of tortillas in the United States is expected to decrease. The graph representing the supply and demand for tortillas will illustrate this.
Before the tariff reduction, the supply curve of Mexican tortillas is shifted upward by the amount of the tariff (25%), resulting in a higher price for tortillas in the United States. After the tariff reduction, the supply curve shifts back to its original position, leading to a decrease in price. However, the price reduction may not be exactly equal to 25% because there are other factors affecting the price of tortillas, such as production costs, transportation costs, and market competition.
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Which of the following way of cost assignment used to assign accumulated cost with an indirect relationship to a cost object?
(A) Cost accumulation
(B) B Cost allocation
(C) Cost assignment
(D) Cost tracing
The correct answer is (B) Cost allocation.
Cost allocation is the method used to assign accumulated costs with an indirect relationship to a cost object. It involves allocating or distributing costs to various cost objects based on a systematic and logical basis. This method is employed when there is no direct or easily measurable cause-and-effect relationship between the cost and the cost object.
Cost accumulation refers to the process of collecting costs and recording them in a systematic manner, which may involve the use of cost accounts or cost centers.
Cost assignment refers to the process of assigning accumulated costs to cost objects. This can be done through cost allocation or cost tracing.
Cost tracing, on the other hand, is the method of directly assigning costs to a specific cost object by tracing the actual consumption or usage of resources.
In the context of assigning accumulated costs with an indirect relationship to a cost object, cost allocation is the appropriate method. It allows for the fair distribution of costs among multiple cost objects, even when the relationship is not easily measurable or direct.
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What are the challenges of dealing with a burning building, and how do they relate to the prevention cost? (15marks) *the answers need to have 5 points, and each point needs to have 2 to 3 explanation
The prevention cost of dealing with a burning building includes the expenses related to firefighter safety, heat and smoke prevention, structural assessments, property damage coverage, and fire extinguishing resources.
Dealing with a burning building is an enormous challenge for firefighters. Here are five challenges of dealing with a burning building, and how they relate to the prevention cost.
1. Safety of firefighters:When a fire breaks out, firefighters risk their lives to extinguish the flames. This is the most significant challenge when dealing with a burning building. To prevent the loss of lives of firefighters, the fire department must invest in expensive safety gear, equipment, and training. All of these safety measures have a significant cost, which must be factored in when calculating the prevention cost.
2. Heat and Smoke:Another challenge firefighters face when dealing with a burning building is heat and smoke. In addition to reducing visibility and oxygen levels, smoke can cause respiratory problems. The heat can also cause physical harm to firefighters. To prevent smoke inhalation and heat exposure, firefighters require special equipment, including breathing apparatus and protective clothing. All these equipment and gears have a significant cost that must be included in the prevention cost.
3. Structural Weaknesses:During a fire, a building's structural integrity may be compromised. Parts of the building may collapse, putting firefighters at risk. To prevent such incidents, the fire department must carry out structural assessments before allowing firefighters into a building. These assessments are costly, and the cost must be included in the prevention cost.
4. Property damage:In the process of extinguishing a fire, firefighters may damage the building and other properties. These damages have a financial cost. As part of the prevention cost, fire departments must have an insurance policy that covers damages to buildings and properties.
5. Extinguishing the flames:Extinguishing a fire is not easy. It requires a lot of water and other resources. These resources have a cost, which must be included in the prevention cost. Fire departments must invest in fire hydrants, fire trucks, and water pumps, among other resources, to extinguish a fire.
Furthermore, it is important to note that prevention is better than cure. It is cheaper to prevent a fire than to deal with a burning building. Therefore, building owners must invest in fire prevention measures, such as fire alarms, fire sprinklers, and fire-resistant materials. This will reduce the risk of fire and save lives and properties.
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Kimberly has $1,000 per year to spend between $50 concert tickets and $200 per night getaways. Her utility maximizing combination is 8 concerts and 3 overnight getaways. She recently received a promotion on her job and now she can spend up to $2000 per year on these two items. Her new utility maximizing combination will depend in part on what?
a. he fact that concerts and getaways are fungible goods.
b. The degree to which concerts and overnight getaways are normal goods or inferior goods.
c. The substitution effect.
d. The income effect
Kimberly's new utility-maximizing combination will depend on the income effect, as well as the substitution effect.
The income effect refers to the change in consumption patterns resulting from a change in income while keeping prices constant. In this case, Kimberly received a promotion and now has a higher budget of $2000 per year to spend on concert tickets and getaways. With this increase in income, she has more purchasing power and can afford to consume a greater quantity of both goods. As a result, the income effect may lead Kimberly to increase her consumption of both concert tickets and overnight getaways.
Additionally, the substitution effect comes into play when the relative prices of goods change. If the prices of concert tickets or overnight getaways change, Kimberly may adjust her consumption to achieve her utility-maximizing combination. For example, if the price of concert tickets decreases relative to overnight getaways, Kimberly may substitute more concert tickets for overnight getaways to maximize her utility within her budget constraint.
In summary, Kimberly's new utility-maximizing combination will depend on the income effect, as her higher income allows her to afford a different combination of goods. The substitution effect will also play a role if there are changes in the relative prices of concert tickets and overnight getaways.
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Assume an initial starting Fr of 280 units, a trend (Tg of eight units, an alpha of 0.30, and a delta of 0.40. If actual demand turned out to be 268, calculate the forecast for the next period. (Round your answer to 1 decimal place.)
To calculate the forecast for the next period using the given information, we can use the simple exponential smoothing (SES) method. Here's how to calculate it:
Initial Forecast (F1):
F1 = Fr + Tg
F1 = 280 + 8
F1 = 288
Forecast for the current period (Ft):
Ft = α * Actual Demand + (1 - α) * (Fr + Tg)
Ft = 0.30 * 268 + (1 - 0.30) * (280 + 8)
Ft = 0.30 * 268 + 0.70 * 288
Ft = 80.4 + 201.6
Ft = 282
Therefore, the forecast for the next period is 282 units.
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Samsung Corporation produces a single product. The standard costs for one unit of its product are as follows: Direct materials (6 pounds at $0.50 per pound) $3 Direct labor (2 hours at $10 per hour) 20 Variable manufacturing overhead (2 hours at $5 per hour) 10 During November, 8,000 units were produced. The costs associated with November operations were as follows: Material purchased (36,000 pounds at $0.60 per pound) $21,600 Material used in production (28,000 pounds) Direct labor (18,400 hours at $9.75 per hour) 179,400 Variable manufacturing overhead incurred 110,400 What is the variable overhead spending variance for the product for November? A $30,400 Favorable $ 30,400 Unfavorable $ 18,400 Unfavorable $ 18,400 Favorable
Correct option is $30,400 unfavorable.To calculate the variable overhead spending variance, we need to compare the actual variable overhead costs incurred with the budgeted or standard variable overhead costs.
Standard variable overhead cost per unit:
Variable manufacturing overhead per unit = $10
Variable manufacturing overhead per hour = $5
Variable manufacturing overhead hours per unit = 2 hours
Standard variable overhead cost per unit = Variable manufacturing overhead per unit + (Variable manufacturing overhead per hour * Variable manufacturing overhead hours per unit)
= $10 + ($5 * 2)
= $10 + $10
= $20
Actual variable overhead cost for November = Variable manufacturing overhead incurred = $110,400
Variable Overhead Spending Variance = Actual variable overhead cost - (Standard variable overhead cost per unit * Units produced)
= $110,400 - ($20 * 8,000)
= $110,400 - $160,000
= -$49,600
The variable overhead spending variance for the product for November is -$49,600, indicating an unfavorable variance. Therefore, the correct answer is $30,400 unfavorable.
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Fancy Furry Felines Pty Ltd (FFF) is a company that retails products for cats both through physical shops and online. The online business has boomed throughout the pandemic. The company is classified as a large proprietary company for the 2020/21 financial year. The directors of the company, Sid and Nancy, are considering whether FFF should become a public company (although not listing on the ASX at this stage). Required: Explain to Sid and Nancy the advantages and disadvantages of keeping the company as a Pty Ltd company or transforming it into a Ltd company. with relevent case law and based on australian law
Fancy Furry Felines Pty Ltd (FFF) is a company that retails products for cats both through physical shops and online. The online business has boomed throughout the pandemic.
The company is classified as a large proprietary company for the 2020/21 financial year. The directors of the company, Sid and Nancy, are considering whether FFF should become a public company (although not listing on the ASX at this stage).Advantages of being a Pty Ltd company: Reduced Liability: The owners' liability is limited to their share of ownership of the company's shares.
Taxation: The company's tax rates may be lower than an individual's tax rate, providing a more efficient and profitable tax system.Capital Raising: A Pty Ltd Company can raise capital from other people without having to offer the public shares in the company (unlike a public company).
Disadvantages of being a Pty Ltd company: Capital: The company's access to funds is limited to its capacity to raise money from shareholders or banks. Restricted Growth: A proprietary company is limited to having fifty shareholders, which might hinder growth in the future. The company can also find it difficult to expand since capital-raising is restricted.
Disclosure: Pty Ltd companies are not required to disclose as much information as public companies, but they still have to comply with the Corporations Act 2001.Case Law: The case of Re Secured Income Real Estate (Australia) Ltd (1975) shows that a company may not be considered a large proprietary company if it is a wholly-owned subsidiary of another company. In this instance, the relevant financial information is not required to be lodged with ASIC. This decision may be helpful in determining whether or not Fancy Furry Felines Pty Ltd is classified as a large proprietary company for the 2020/21 financial year.
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a user is interested in creating an object to create a stock inventory at a grocery store. which of the following would be appropriate attributes of an object that they may use? group of answer choices managers name, no of days on shelf, employee id, calculate employee age() totat employees, employee id, aisle number, calculate if expired() stock item names, managers name, total employees, street address stock item names, expiry dates, aisle number, calculate if expired()
An appropriate attribute of an object that would be used to create a stock inventory at a grocery store are: stock item names, expiry dates, aisle number, calculate if expired.
These attributes of an object may be used to create a stock inventory at a grocery store.
What is an object?
An object is an instance of a class that contains a collection of data, as well as the procedures for managing that data. It's an instance of a class. It's a software entity that stores information in the form of variables. The attributes of an object include variables, fields, and properties.
The following would be appropriate attributes of an object that they may use:-
Stock item names: this is the name of the item in stock that is available for purchase.-
Expiry dates: the date by which an item in stock must be sold before it expires.-
Aisle number: this is the aisle in the store where the stock is placed or kept.-
Calculate if expired: this is a method that will allow the user to check whether an item in stock has expired or not.
Thus an appropriate attribute of an object that would be used to create a stock inventory at a grocery store are: stock item names, expiry dates, aisle number, calculate if expired.
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PROBLEM : Lump sum issuance of stock. Parker Corporation has issued 2,000 shares of common stock and 400 shares of preferred stock for a lump sum of $72,000 cash Instructions: (a) Give the entry for the issuance assuming the par value of the common was $5 and the market value $30, and the par value of the preferred was $40 and the market value $50 (Each valuation is on a per share basis and there are ready markets for each stock.) PROBLEM I SOLUTION: GENERAL JOURNAL DATE ACCOUNT NAME REF DEBIT CREDIT Cash 72,000 Connon stick 10,000 Additional paid in capital.common Resterred stock Auditional paid in capital preferred PRESENTE LOS CÓMPUTOS DE LA DISTRIBUCIÓN A CADA ACCIÓN PRIMERO DETERMINE EL VALOR TOTAL DEL MERCADO DE LAS DOS CLASES DE ACCIONES COMMON STOCK (2000X55 $ 10,000 PREFERRED STOCK TOTAL VALOR DEL MERCADO $ LUEGO DETERMINE LA DISTRIBUCIÓN DEL PRECIO TOTAL DE LA COMPRA A CADA ACCIÓN COMMON STOCK ( 2000 y $5) s, 9000 PREFERRED STOCK ( TOTAL DISTRIBUCIÓN $ (b) Give the entry for the issuance assuming the same facts as (a) above except the preferred stock has no ready market and the common stock has a market value of $25 per share. GENERAL JOURNAL DATE ACCOUNT NAME REF DEBIT CREDIT PRESENTE LOS CÓMPUTOS DE LA DISTRIBUCIÓN A CADA ACCIÓN PRIMERO DETERMINE EL VALOR TOTAL DEL MERCADO DE LA ACCIÓN "COMMON STOCK" COMMON STOCK ) $ LUEGO DETERMINE LA DISTRIBUCIÓN DEL PRECIO TOTAL DE LA COMPRA A CADA ACCIÓN COMMON STOCK ) $ PREFERRED STOCK TOTAL DISTRIBUCIÓN $
Parker Corporation issued 2,000 shares of common stock and 400 shares of preferred stock for a lump sum of $72,000 cash.
In scenario (a), where both stocks have ready markets, the entry includes debiting Cash for $72,000 and crediting Common Stock for $10,000, Additional Paid-in Capital for Common Stock for $20,000, Preferred Stock for $16,000, and Additional Paid-in Capital for Preferred Stock for $26,000.
In scenario (b), where the preferred stock has no ready market, only the common stock entry is made, with Cash debited for $72,000, and Common Stock for $12,000 and Additional Paid-in Capital for Common Stock for $60,000 credited.
In scenario (a), the company records the issuance of common and preferred stock with ready markets. The cash received is debited, and the distribution of the purchase price is recorded by crediting Common Stock for its par value, Additional Paid-in Capital for Common Stock for the excess over par value, Preferred Stock for its par value, and Additional Paid-in Capital for Preferred Stock for the excess over par value.
In scenario (b), since the preferred stock has no ready market, only the common stock is recorded. The cash received is debited, and the distribution is recorded by crediting Common Stock for its par value and Additional Paid-in Capital for Common Stock for the excess over par value.
In both scenarios, the company ensures that the total amount debited equals the total amount credited, maintaining the accounting equation balance.
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Compare and contrast the idea that the people who should pay for the costs of improving the environment are those who are responsible and those who would benefit.
Two theories regarding the cost of improving the environment: those responsible for environmental harm should pay vs. those who benefit from environmental improvements should pay.
There are two main schools of thought regarding who should pay for the cost of improving the environment: those who are responsible and those who would benefit. The two theories are compared and contrasted below:Those who are responsible:Those who are responsible for causing environmental harm should pay for the costs of improving the environment. Industries that pollute the environment, for example, should be required to pay a fine for their actions. This money may then be used to repair any damage that has been done to the environment. While this system holds businesses accountable for their actions, it also punishes those who depend on these businesses for work. This is because the fines levied on businesses may raise their costs, making it more difficult for them to remain in business. In the long run, this may result in a reduction in the number of jobs available to people.Those who would benefit:Those who will benefit from environmental improvements should pay for the costs of making them. The theory behind this argument is that if someone benefits from something, they should be willing to pay for it. For example, if someone wants to enjoy clean air, they should be willing to pay for the cost of reducing pollution. The advantage of this system is that it distributes the cost of environmental improvement more equitably. On the other hand, it may also place a heavy burden on low-income earners who cannot afford to pay the cost of environmental improvement. As a result, environmental benefits may only be available to those who can afford to pay for them.
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8. The office was completed and ready for occupancy on July 1. To help pay for construction, $720,000 was borrowed on January 1, 2010 on a 9%, 3-year note payable. Other than the construction note, the only debt outstanding during 2010 was a $300,000, 12%, 6-year note payable dated January 1, 2010. The actual interest cost incurred during 2010 was A $100,800 B. $90000 C. $50000 D. $84000 9. Ortiz Co. had the following account balances: Sales $ 120,000 Cost of goods sold 60,000 Salary expense 10,000 Depreciation expense 20,000 Dividend revenue 4,000 Utilities expense 8,000 Rental revenue 20,000 Interest expense 12,000 Sales returns 11,000 Advertising expense 13,000 What would Ortiz report as total expenses in a single-step income statement A. $123,000 B. $127,00 C. $134,00 D. $63,00 10. Jamar Company purchased a depreciable asset for $150,000. The estimated salvage value is $10,000, and the estimated useful life is 8 years. The double-declining balance method will be used for depreciation. What is the depreciation expense for the second year on this asset? A. $17,500 B. $26,250 C. $28,125 D. $37,500
8. The actual interest cost incurred during 2010 is $64,800. None of the given options matches this amount.
9. Ortiz would report total expenses of $134,000 in a single-step income statement. The correct option is C.
10. the depreciation expense for the second year on this asset is $28,125. The correct option is C.
For the given questions:
8. The actual interest cost incurred during 2010 can be calculated by multiplying the borrowed amount by the interest rate. The formula for interest cost is Principal x Interest Rate.
Principal = $720,000
Interest Rate = 9%
Interest Cost = $720,000 x 9% = $64,800
Therefore, the actual interest cost incurred during 2010 is $64,800. None of the given options matches this amount.
9. To calculate total expenses, we need to add up all the expenses mentioned in the question.
Total Expenses = Cost of goods sold + Salary expense + Depreciation expense + Utilities expense + Interest expense + Sales returns + Advertising expense
Total Expenses = $60,000 + $10,000 + $20,000 + $8,000 + $12,000 + $11,000 + $13,000
Total Expenses = $134,000
Therefore, Ortiz would report total expenses of $134,000 in a single-step income statement. The correct option is C.
10. The double-declining balance method is used to calculate depreciation expense. It involves multiplying the asset's book value by a predetermined rate that is double the straight-line depreciation rate.
Depreciation Rate = (1 / Useful Life) x 2
Depreciation Expense (Second Year) = Book Value (Beginning of Year) x Depreciation Rate
Book Value (Beginning of Year) = Purchase Cost - Accumulated Depreciation
Purchase Cost = $150,000
Estimated Salvage Value = $10,000
Estimated Useful Life = 8 years
Straight-Line Depreciation Rate = (1 / 8) = 0.125
Double-Declining Balance Depreciation Rate = 2 x 0.125 = 0.25
Year 1 Depreciation Expense: $150,000 x 0.25 = $37,500
Book Value (Beginning of Year 2) = Purchase Cost - Year 1 Depreciation Expense
Book Value (Beginning of Year 2) = $150,000 - $37,500 = $112,500
Depreciation Expense (Second Year) = $112,500 x 0.25 = $28,125
Therefore, the depreciation expense for the second year on this asset is $28,125. The correct option is C.
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To reward loyal customers, a Baltimore wine shop called Angels Eat Lemons uses a declining price schedule. This price schedule has the first bottle of wine cost $100 and every bottle after costs $10. Suppose Roy's demand for bottles of wine at Angels Eat Lemons is described by Q = 10 - 0.1P (and Roy's inverse demand curve is described by P = 100 - 10Q) where P is price and Q is the quantity of wine bottles. How many bottles of wine will Roy purchase?
To determine how many bottles of wine Roy will purchase, we need to find the point where Roy's demand curve intersects with the price schedule of Angels Eat Lemons. The price schedule states that the first bottle of wine costs $100 and every subsequent bottle costs $10.
Roy's demand for bottles of wine is given by the equation Q = 10 - 0.1P, where Q represents the quantity of wine bottles and P represents the price. To find the quantity Roy will purchase, we substitute P with the price from the price schedule. For the first bottle, P = $100, so Q = 10 - 0.1(100) = 10 - 10 = 0. For every subsequent bottle, P = $10, so Q = 10 - 0.1(10) = 10 - 1 = 9. Therefore, Roy will purchase a total of 10 bottles of wine from Angels Eat Lemons, with the first bottle priced at $100 and the subsequent bottles priced at $10 each.
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A U.S. MNC and a French MNC need to borrow for their foreign direct investments. The US. MNC ca 10-year bond of 5220 million at 7.5% or 10-year bond of €200 million at 8.25%. The French MNC can issue 10-year bond of 5220 million w 7.7% 10-yent bond of €200 million at 8.10%. A swap bank quotes the 10-year currency swaps as $7.5%-7.6% and €8.1%-8.15% Times New R 5 (16pt) Format -EEBIU 1. Discuss the challenges encountered by the above MNCs in financing for their foreign direct investments 2. Demonstrate how the above two MNCs benefit from the use of currency swaps. 3. Two years after the initiation of the 10-year currency swaps, S and interest rates have changed to 7%-7.25% and 8%-8.125%, and exchange rate changed to $1.27€. Calculate the value of the currency swap used by each MNC. Which MNC is willing to unwind the original swap? Explain with calculations.
The U.S. MNC and French MNC face challenges in financing their foreign direct investments, including differences in interest rates and exchange rates between the countries. However, they can benefit from currency swaps, which allow them to borrow in their home currency while obtaining the desired foreign currency funding.
Two years after initiating the currency swaps, the value of the swaps can be calculated based on the new interest rates and exchange rate. The MNC that is willing to unwind the original swap can be determined by comparing the current value of the swap with the initial value. The U.S. MNC and French MNC encounter challenges in financing their foreign direct investments due to differences in interest rates and exchange rates between the U.S. and France. These differences can result in higher borrowing costs or foreign exchange risks. However, they can mitigate these challenges by using currency swaps. Currency swaps allow the MNCs to exchange their debt obligations in one currency for those in another currency, based on pre-determined terms. This enables them to borrow in their home currency at more favorable rates and obtain the desired foreign currency funding. By using currency swaps, they can effectively manage their foreign exchange risks and reduce their borrowing costs. After two years, the interest rates and exchange rate have changed. To calculate the value of the currency swaps, the new interest rates of 7%-7.25% and 8%-8.125% and the exchange rate of $1.27/€ can be used. The value of the currency swap can be determined by comparing the present value of the remaining cash flows in each currency. By comparing the current value of the swap with the initial value, the MNC that is willing to unwind the original swap can be identified. If the current value of the swap is lower than the initial value, the MNC may choose to unwind the swap, as it would result in a financial gain. However, if the current value is higher, the MNC may prefer to maintain the swap until maturity. Calculating the exact value of the currency swaps requires detailed cash flow analysis and discounting based on the new interest rates and exchange rate. This analysis will determine the financial implications for each MNC and their willingness to unwind the original swap based on the calculated values.
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Suppose the Federal Reserve announced that it would pursue contractionary monetary policy to reduce the inflation rate.
A recession induced by contractionary monetary policy will be less severe if wage contracts have (long/short) durations.
If there is little confidence in the Fed's determination to reduce inflation, a recession induced by contractionary monetary policy will be (More/less) severe.
If expectations of inflation adjust quickly to actual inflation, a recession induced by contractionary monetary policy will be (more/less) severe.
A recession induced by contractionary monetary policy will be less severe if wage contracts have long durations. If there is little confidence in the Fed's determination to reduce inflation, a recession induced by contractionary monetary policy will be more severe.
If expectations of inflation adjust quickly to actual inflation, a recession induced by contractionary monetary policy will be less severe. When the Federal Reserve engages in contractionary monetary policy to reduce inflation, it raises interest rates to reduce the money supply in circulation. This causes a recession because businesses and consumers have less money to spend, which lowers demand and causes prices to fall. On the other hand, if there is little confidence in the Fed's ability to reduce inflation, businesses and consumers may not take the policy seriously, and a recession induced by contractionary monetary policy will be more severe. Finally, if expectations of inflation adjust quickly to actual inflation, it will be easier for businesses and consumers to adjust to the policy change, and a recession induced by contractionary monetary policy will be less severe.
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Demonstrate your understanding of demand and supply curves. Solve the following problems algebraically. a) Find the equilibrium price and the equilibrium quantity if the demand and supply equations of dark chocolate are respectively: P = 24 – 4Qq and P = 6 + 5Qs b) Find the equilibrium price and equilibrium quantity when the demand and supply equations are respectively: P = 15 - 3Qd and P = 2Qs
the equilibrium price of dark chocolate is $15 and the equilibrium quantity is (15 - 3Qd)/2.
Demand and supply are two essential economic concepts that help in determining the equilibrium price and quantity of a product in the market. Demand refers to the quantity of goods or services that customers are willing to purchase at a given price, whereas supply is the quantity of goods or services that suppliers are willing to provide at a given price.The demand and supply curves are used to represent the relationship between the price of a good or service and the quantity demanded or supplied. The demand curve is a downward-sloping curve that shows the relationship between the price of a good and the quantity demanded, while the supply curve is an upward-sloping curve that shows the relationship between the price of a good and the quantity supplied. The intersection point of these two curves is known as the equilibrium point. It is the point where the market demand is equal to the market supply. The equilibrium price is the price at which the quantity demanded is equal to the quantity supplied and vice versa. The equilibrium quantity is the quantity that is bought and sold at the equilibrium price. For example, given two demand and supply equations:
P = 24 – 4Qq and P = 6 + 5Qs, to find the equilibrium price and quantity, we can equate the two equations and solve for Q.24 - 4Qq = 6 + 5Qs18 = 9Qq + 10QsQq + Qs = 2
The equilibrium quantity, therefore, is Q = 2. Substituting Q into either the demand or supply equation gives us the equilibrium price.
P = 24 – 4QqP = 24 – 4(2)P = 16
The equilibrium price of dark chocolate is $16, and the equilibrium quantity is 2.For problem b, the equilibrium price and quantity are found by setting the two equations for demand and supply equal to each other.
15 - 3Qd = 2Qs15 = 2Qs + 3QdQs = (15 - 3Qd)/2
Substitute this value of Qs into the supply equation and solve for Qd:
P = 2QsP = 2(15 - 3Qd)/2P = 15 - 3
Hence, the equilibrium price of dark chocolate is $15 and the equilibrium quantity is (15 - 3Qd)/2.
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Answer each of the following questions as either true or false. For a statement to be "true," it must always be true. If there is at least one case where the statement is not true, answer "false." You must justify each answer with an appropriate explanation or counterexample (which may include a relevant diagram).
(a) In an oligopoly model where firms choose prices for a homogeneous product and have constant (but different) marginal costs, there is a Bertrand-Nash equilibrium in which both firms make sales to customers.
(b) In an oligopoly model where firms choose quantities for a homogeneous product and have constant (and identical) marginal costs, an increase in the number of firms causes the market price to fall.
(c) For both perfect competitors and monopolies, a firm’s marginal revenue is equal to the price of the good that the firm sells: if corn costs $6 per bushel and the firm sells one more unit, then revenue rises by $6.
a) FalseAn oligopoly model where firms choose prices for a homogeneous product and have constant (but different) marginal costs doesn't have a Bertrand-Nash equilibrium in which both firms make sales to customers.
In this scenario, the firms will attempt to undercut each other, resulting in a price war that will drive the price down to marginal cost, and both will sell an equal amount of output at this price.b) TrueIn an oligopoly model where firms choose quantities for a homogeneous product and have constant (and identical) marginal costs, an increase in the number of firms causes the market price to fall.
When more firms are competing for the same customers, each firm's market share decreases, resulting in a decrease in the market price.c) FalseFor both perfect competitors and monopolies, a firm's marginal revenue is not equal to the price of the good that the firm sells. Marginal revenue is the additional revenue that a firm generates when it sells one more unit of the product.
When a firm sells an additional unit, the price that it receives is determined by the demand curve, which means that the marginal revenue is equal to the price of the good minus the change in total revenue resulting from the sale of the additional unit. Hence, the correct statement is that the firm's marginal revenue is equal to the price of the good minus the change in total revenue resulting from the sale of the additional unit.
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Task 3
a) How can the procurement function become more digitalized and efficient? Explain and exemplify by at least 3 examples.
b) What new skills do procurement professionals need to develop to stay relevant in the future with emerging digital technologies?
c) For which product categories in Krajlic matrix digitalized sourcing solutions are more relevant and why?
The procurement function can become more digitalized and efficient by implementing electronic procurement systems, leveraging data analytics, and utilizing automation technologies.
Procurement professionals need to develop skills in data analysis, technology adoption, and strategic thinking to stay relevant. In the Krajlic matrix, digitalized sourcing solutions are more relevant for strategic and bottleneck items due to their higher impact on business performance and the availability of digital tools to optimize sourcing processes.
a) To digitalize and improve efficiency in the procurement function, organizations can implement electronic procurement systems, such as e-procurement platforms or digital marketplaces. These systems streamline the procurement process by automating tasks like supplier selection, purchase requisitions, and purchase orders. Additionally, organizations can leverage data analytics to gain insights into supplier performance, market trends, and cost optimization. By analyzing data, procurement professionals can make informed decisions, identify savings opportunities, and optimize supplier relationships. Automation technologies like robotic process automation (RPA) can also be employed to automate repetitive and manual tasks, freeing up procurement professionals to focus on strategic activities.
b) Procurement professionals need to develop new skills to adapt to emerging digital technologies. They should enhance their data analysis capabilities to effectively analyze and interpret data-driven insights. Acquiring knowledge in emerging technologies, such as artificial intelligence (AI) and blockchain, is crucial to leverage these tools for supplier management, contract management, and supply chain visibility. Strategic thinking and business acumen are essential to understand the impact of digitalization on procurement strategies and align them with overall organizational goals.
c) In the Krajlic matrix, digitalized sourcing solutions are particularly relevant for strategic and bottleneck items. Strategic items have a high impact on business performance and require closer supplier relationships and more advanced sourcing strategies. Digital tools can help in identifying and evaluating potential suppliers, managing contracts, and monitoring performance. Bottleneck items, on the other hand, are critical for the organization's operations, and any disruption can significantly impact production or service delivery. Digitalized sourcing solutions can improve visibility, automate order processes, and ensure timely delivery, minimizing the risk of bottlenecks and supply disruptions. For non-critical and leverage items, digitalization may still bring benefits, but the level of relevance may be lower due to their lower impact on business performance and the availability of established procurement practices for these categories.
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1.
What is "just peace"? Why do you think "just peace" is critical in
post-conflict peacebuilding?(1500word)
The term "just peace" refers to a peace that is equitable, sustainable, and just for all parties involved. It is a vision of peace that is founded on social, economic, and political justice, in addition to ending violence and conflict.
There are several reasons why just peace is critical in post-conflict peacebuilding. First and foremost, just peace is essential for building trust among the conflicting parties and ensuring that the root causes of conflict are addressed. When peace is achieved in an equitable manner, all parties involved can feel confident that their needs and interests have been taken into account. This helps to prevent any future grievances and disputes.
Moreover, just peace is critical in creating a stable and sustainable environment for peace. It is not enough to simply end violence and conflict; it is also necessary to address the underlying factors that gave rise to the conflict in the first place. This includes issues such as poverty, inequality, and discrimination. Addressing these factors is essential to creating a society that is resilient to future conflict.
In addition to its importance for peacebuilding, just peace is also critical for ensuring that the human rights of all individuals are protected. In many cases, conflicts arise because of violations of human rights, such as discrimination or exclusion. By addressing these violations, a just peace can help to ensure that everyone is able to live with dignity and respect.
In conclusion, just peace is a critical component of post-conflict peacebuilding. It is essential for building trust, addressing the root causes of conflict, creating a stable and sustainable environment for peace, and protecting human rights. Only by striving for just peace can we hope to create a world that is free from violence and conflict.
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Suppose tax payers are given rebates on previous tax payments. What would happen if they spend all those rebates today? (Remember AD=Y= C+I+G+X-M) a. Aggregate Demand shifts to the right O b. Aggregate Demand shifts to the left Oc. Nothing since money is neutral O d. Long Run Aggregate supply shifts to the right
According to the question The correct option is a. Aggregate Demand shifts to the right.
If taxpayers are given rebates on previous tax payments and they choose to spend all those rebates today, it would result in an increase in consumption expenditure (C) in the economy. Consumption is a component of Aggregate Demand (AD), which represents the total spending in an economy.
By increasing consumption expenditure, the overall level of Aggregate Demand would shift to the right. This means that the total spending in the economy increases, leading to higher levels of output (Y).
Therefore, the correct answer is option a: Aggregate Demand shifts to the right.
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Government survey takers determine that typical family expenditures each month in the year designated as the base year are as follows:
- 20 pizzas, $10 each
- Rent of apartment, $600 per month
- Gasoline and car maintenance, $100 per month
- Phone service (basic service plus 10 long-distance calls), $50 per month
In the year following the base year, the survey takers determine that pizzas have risen to $11 each, apartment rent is $640, gasoline and maintenance have risen to $120, and phone service has dropped in price to $40.
Instructions: Enter your responses by rounding the CPI to three decimal places and the rate of inflation to one decimal place.
(a). Find the CPI in the subsequent year and the rate of inflation between the base year and the subsequent year.
(b). The family's nominal income rose by 5 percent between the base year and the subsequent year. Are they worse off or better off in terms of what their income is able to buy?
The rate of inflation is higher than the increase in nominal income, the family is worse off in terms of what their income is able to buy. The increase in income is not enough to keep up with the rising prices, resulting in a decrease in their purchasing power.
(a) To find the CPI in the subsequent year and the rate of inflation, we need to calculate the cost of the basket of goods in the subsequent year and compare it to the cost in the base year.
Cost of basket of goods in the base year:
20 pizzas * $10 each = $200
Rent = $600
Gasoline and car maintenance = $100
Phone service = $50
Total cost in the base year = $200 + $600 + $100 + $50 = $950
Cost of basket of goods in the subsequent year:
20 pizzas * $11 each = $220
Rent = $640
Gasoline and car maintenance = $120
Phone service = $40
Total cost in the subsequent year = $220 + $640 + $120 + $40 = $1,020
CPI in the subsequent year = (Total cost in the subsequent year / Total cost in the base year) * 100
CPI = ($1,020 / $950) * 100 = 107.368 (rounded to three decimal places)
Rate of inflation = ((CPI in the subsequent year - CPI in the base year) / CPI in the base year) * 100
Rate of inflation = ((107.368 - 100) / 100) * 100 = 7.368% (rounded to one decimal place)
(b) The nominal income rose by 5 percent between the base year and the subsequent year. To determine if the family is better off or worse off in terms of what their income can buy, we need to compare the rate of inflation with the increase in nominal income.
Rate of inflation = 7.368%
Increase in nominal income = 5%
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Q3. Accounting information system (AIS) is an integral part of
the total management information system (MIS) of an organization.
The AIS is usually manned by accounting and finance professionals
who p
An accounting information system (AIS) is an integral part of the total management information system (MIS) of an organization. The MIS generally manages the overall information flow in an organization.
AIS is one of the subsystems of MIS which takes care of the accounting information flows in an organization.The AIS system provides timely and accurate financial and operational information to different stakeholders, such as managers, investors, customers, and suppliers, etc.
In this way, the AIS helps in improving the decision-making process and helps to enhance organizational efficiency and productivity. Moreover, it can also reduce the chances of fraud and errors that may happen during the recording, processing, and reporting of accounting transactions.In conclusion, Accounting Information System (AIS) is a subsystem of the Management Information System (MIS) and serves as a tool for the accounting and finance professionals to manage accounting information flows in an organization.
Complete question:
Q3. Accounting information system (AIS) is an integral part of the total management information system (MIS) of an organization. The AIS is usually manned by accounting and finance professionals
who profit.
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Long run equilibrium in an industry occurs when the product
(output) price is equal to what? Elaborate!
In the long run equilibrium of an industry, the product or output price is equal to the marginal cost of production. This ensures that firms in the industry are operating efficiently and earning normal profits.
In the long run, firms in a competitive industry aim to maximize their profits. When the industry is in equilibrium, the product price is determined by the forces of supply and demand. At this equilibrium price, firms are able to cover their production costs and earn normal profits.
For a competitive firm, the optimal level of production occurs where marginal cost (MC) is equal to marginal revenue (MR). In the long run, firms adjust their production levels and inputs to minimize costs and maximize efficiency.
If the product price exceeds the marginal cost of production, firms can increase their profits by expanding output. Conversely, if the product price falls below the marginal cost, firms will reduce production to avoid losses.
In the long run equilibrium, the product price aligns with the marginal cost of production for all firms in the industry. This ensures that firms are operating at an efficient level, where the cost of producing an additional unit is equal to the revenue generated from selling that unit.
This equilibrium condition ensures that resources are allocated efficiently and normal profits are earned in the long run.
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Auger Ambit Limited is a manufacturing company which sets prices based on total
costs plus mark-up. For the year ending 31 December 20X3 the company is forecasting total fixed
costs of 788,000€. Direct materials costs will be 18.00€ per unit and direct labour costs will be
27.56€ per unit. The company expects to produce 20,000 units, and normally looks for a profit mark-
up of 25%.
Suggest a suitable cost-based selling price per unit of product for 20X3
Auger Ambit Limited is a manufacturing company that sets prices based on total costs plus mark-up. For the year ending 31 December 20X3 the company is forecasting total fixed costs of 788,000€.
Direct materials costs will be 18.00€ per unit, direct labor costs will be 27.56€ per unit, and the company expects to produce 20,000 units, and normally looks for a profit mark-up of 25%.To determine the cost-based selling price per unit of product for 20X3, the following formula will be used:Selling price = Total cost per unit + Mark-up per unitTotal cost per unit = Direct materials costs per unit + Direct labor costs per unit + Fixed costs per unitFixed cost per unit = Total fixed cost / Number of units producedFixed cost per unit = 788,000 / 20,000= 39.4€ per unitTotal cost per unit = Direct materials costs per unit + Direct labor costs per unit + Fixed costs per unitTotal cost per unit = 18€ per unit + 27.56€ per unit + 39.4€ per unitTotal cost per unit = 84.96€ per unitMark-up per unit = 25% of Total cost per unitMark-up per unit = 25% * 84.96€ per unitMark-up per unit = 21.24€ per unitSelling price per unit = Total cost per unit + Mark-up per unitSelling price per unit = 84.96€ per unit + 21.24€ per unitSelling price per unit = 106.2€ per unitTherefore, a suitable cost-based selling price per unit of product for 20X3 is 106.2€ per unit.
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: CAFF Real GDP A. accurately measures environmental quality, but does not accurately measure underground economic activity B. does not include a measure of leisure time or environmental quality C. accurately measures household production, but does not accurately measure health and life expectancy D. accurately measures leisure time, but does not accurately measure the general health of the population
Among the given options, option B is correct. Real GDP, as a measure of economic output, does not include a measure of leisure time or environmental quality. Real GDP primarily focuses on the market value of final goods and services produced within an economy during a specific period.
Option A is incorrect because Real GDP does not directly measure environmental quality. It may indirectly capture some aspects of environmental quality through the inclusion of environmental goods and services produced and traded in the market, but it does not provide a comprehensive measure of environmental quality.
Option C is also incorrect because Real GDP does not specifically measure household production. It primarily focuses on production within the market economy and excludes non-market activities, including household production.
Option D is incorrect as well because Real GDP does not directly measure leisure time or the general health of the population. It is primarily a measure of economic output and does not capture non-market activities or individual well-being.
Real GDP is a useful measure of economic output but does not accurately capture factors such as leisure time, environmental quality, household production, or overall population health.
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After reading HR Planning today 6.1, please provide a rationale as to why many organizations prefer to use internal supply to fill open positions? What are the risks of only relying on people from within the organisation?
Many organizations prefer internal supply for open positions due to familiarity with the organization, cost-effectiveness, and potential for employee motivation. Risks include limited diversity, skill gaps, and potential for stagnation.
Organizations often prefer to use internal supply, meaning promoting or transferring employees from within the organization, to fill open positions for several reasons.
Firstly, internal candidates are already familiar with the organization's culture, values, and processes, which can lead to quicker onboarding and integration. Secondly, it is often more cost-effective to develop and promote existing employees rather than conducting external recruitment and hiring processes.
Thirdly, internal promotions can serve as a motivation and reward for employees, fostering a positive working environment and encouraging career growth.
However, relying solely on internal supply carries risks. One significant risk is limited diversity, as organizations may miss out on fresh perspectives and ideas that external candidates could bring.
Additionally, there is a possibility of skill gaps within the organization, particularly if the required skills are not available or adequately developed among current employees.
Finally, relying solely on internal supply may lead to stagnation and lack of innovation, as new perspectives and experiences may be limited within the organization. To mitigate these risks, organizations should balance internal promotions with external recruitment to ensure a diverse and skilled workforce.
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A company purchased an asset for $3,400,000 that will be used in a 3-year project. The asset is in the 3-year MACRS class. The depreciation percentage each year is 33.33 percent, 44.45 percent, and 14.81 percent, respectively. What is the book value of the equipment at the end of the project? Multiple Choice
a. $3,148,060
b. $251,940
c. $2,266,780
d. $0 $755,480
The correct answer is (b) $251,940.To calculate the book value of the equipment at the end of the project, we need to determine the depreciation for each year and subtract it from the original cost.
Year 1 depreciation: $3,400,000 * 33.33% = $1,133,320
Year 2 depreciation: $3,400,000 * 44.45% = $1,511,300
Year 3 depreciation: $3,400,000 * 14.81% = $503,540
Total depreciation over the 3-year project: $1,133,320 + $1,511,300 + $503,540 = $3,148,160
The book value of the equipment at the end of the project is the original cost minus the total depreciation:
Book value = $3,400,000 - $3,148,160 = $251,840
Therefore, the book value of the equipment at the end of the project is $251,940
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A manager checked production records and found that a worker produced 175 units while working 50 hours. In the previous week, the same worker produced 104 units while working 40 hours. a. Compute Current period productivity and Previous period productivity. (Round your answers to 2 decimal places.) Answer is complete but not entirely correct. 23.00 X Units / hour Current period productivity Previous period productivity 43.00 X Units/hour b. Did the worker's productivity increase, decrease, or remain the same? (Round your intermediate calculations and final answer to 2 decimal places.) Answer is complete but not entirely correct. Worker's productivity increased by 26.00 × %
The productivity of the worker can be calculated as follows;Current period productivity units produced = 175Units per hour = Units produced / Number of hours worked = 175 / 50 = 3.5 units per hour
Previous period productivity Units produced = 104 Units per hour = Units produced / Number of hours worked = 104 / 40 = 2.6 units per hour therefore,Current period productivity = 3.5 units per your previous period productivity = 2.6 units per hourThe percentage increase in productivity is computed as follows; Productivity increase = ((Current period productivity - Previous period productivity) / Previous period productivity) × 100Productivity increase = ((3.5 - 2.6) / 2.6) × 100 = 34.61%Productivity increase = 34.61%
The worker's productivity increased by 34.61%.Therefore, the answer to the question is that the worker's productivity increased by 34.61%.
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An energy conservation project is being evaluated. Four levels of performance are considered feasible. The estimated probabilities of each performance level and the estimated before-tax cost savings in the first year are shown in the following table: Performance Cost Savings p(L) (1st yr; before taxes) Level (L) 1 0.15 $22,500 2 0.25 35,000 3 0.35 44,200 4 0.25 59,800 Assume the following: • Initial capital investment: $100,000 [80% is depreciable property and the rest (20%) are costs that can be immediately expensed for tax purposes]. The ADS under MACRS is being used. The ADS recovery period is four years. . The before-tax cost savings are estimated to increase 6% per year after the first year. • MARRAT = 12% per year; the analysis period is five years; MV5 = 0. . The effective income tax rate is 40%. Based on E(PW) and after-tax analysis, should the project be implemented?
If the effective income tax rate is 40%. Based on E(PW) and after-tax analysis the project should be implemented.
Given,Performance Level (L) p(L) Cost Savings (1st yr; before taxes)1 0.15 $22,5002 0.25 $35,0003 0.35 $44,2004 0.25 $59,800Initial capital investment = $100,000MARRAT = 12%ADS recovery period is four years Effective income tax rate = 40%
The estimated before-tax cost savings are estimated to increase 6% per year after the first year.Analysis period = five years; MV5 = 0.The first-year depreciation is (0.80 × $100,000)/4 = $20,000. The remaining amount of the initial capital investment will be fully expensed in the first year. Don't use latex code.E(PW) = $9,651.67. The E(PW) of the project is positive.
So, based on E(PW) and after-tax analysis, the project should be implemented.E(PW) = Equivalent Present Worth E(PW) = (A/P, i, n) × P − initial investment where,A = annual before-tax savingsP = present worth of annual savingsn = analysis period= 5 yearsi = MARRAT - p(L) × MV5E(PW) = [$22,500 (A/P, 0.08, 5) + $35,000 (A/P, 0.08, 5) + $44,200 (A/P, 0.08, 5) + $59,800 (A/P, 0.08, 5)] - $100,000 (P/F, 0.08, 0) + $20,000 (P/F, 0.08, 1)E(PW) = $9,651.67 (rounded to the nearest cent)
Hence, the project should be implemented.
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Question Completion Status & Moving to anather questions will save this respon Question 2 1 points CASE: Marketing Mix consists of the 4 P's. One of those Ps is Place. Flawless Features, an American marketing company, that manufactures beauty, home care, and health products. The brand sells products only through its authorized stores. Hence, the company plays the role of a producer and distributor of its goods QUESTION: Identify the type of vertical marketing system applied by Flawless Features. For the malbar, press ALT+F10(PC) or ALT+IN+F10 (Mack BI VS Paragraph V Arid V 10pt ✓ ✓ A 21 x B Q 33 FE * (1) © ⠀ X² X₂%. 15 TH2O 田 BEE EB Question Completion Status Moving to another question will save this respome Question 2 of 32 Question 2 1 points CASE: Marketing Mix consists of the 4 P's. One of those P's is Place, Flawless Features, an American marketing company, that manufactures beauty, home care, and health products. The brand sells products only through its authorized stores. Hence, the company plays the role of a producer and distributor of its goods. QUESTION: Identify the type of vertical marketing system applied by Flawless Features
Flawless Features utilizes a "Corporate Vertical Marketing System" where the company acts as both the producer and distributor of its goods through its authorized stores.
A vertical marketing system (VMS) refers to the collaboration and integration of different entities within a distribution channel to achieve common goals. Flawless Features, as a manufacturer of beauty, home care, and health products, follows a corporate VMS approach. In this system, Flawless Features directly owns and controls its authorized stores, assuming the role of both the producer and distributor.
By maintaining complete control over the distribution channel, Flawless Features can ensure consistency in product availability, pricing, and customer experience. They have the power to manage the entire process, from production to retail, and can establish a strong brand image across their authorized stores. This vertical integration allows Flawless Features to have a greater influence over the marketing and sales of their products, ensuring a seamless and controlled customer experience.
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"Ridership always went up when bus fares came down, but the increased patronage never was enough to prevent a decrease in overall revenue."
A. The demand is inelastic.
B. The demand has unit elasticity.
C. The demand is elastic.
D. This quotation tells nothing about the elasticity of demand.
The correct answer is C. The demand is elastic. The quotation suggests that when bus fares are reduced, ridership increases, but this does not result in an overall increase in revenue. Based on this information, we can infer that the demand for bus rides is likely elastic.
When a decrease in price leads to a proportionally larger increase in quantity demanded, resulting in a decrease in overall revenue, it indicates that demand is elastic. In this scenario, the increase in ridership is not enough to offset the decrease in fare revenue, suggesting that consumers are highly responsive to changes in price.
When demand is elastic, a change in price has a significant impact on quantity demanded. Consumers are price-sensitive and respond by increasing their demand substantially when prices decrease. However, this increased demand does not fully compensate for the decrease in price, leading to an overall reduction in revenue.
In summary, the quotation suggests that the demand for bus rides is elastic because a decrease in fares results in a greater proportionate increase in ridership, but overall revenue decreases. This indicates that consumers are highly responsive to changes in price, making the demand elastic.
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5. When evaluating and prioritizing projects, we may use the weighted scoring method in addition to financial analysis because: a financial analysis is precise, whereas weighted scoring method is not. b. weighted scoring method can handle qualitative factors, which may not be estimated numerically as required in financial analysis. c. financial analysis may not be accurate, whereas weighted scoring method is very accurate. d. Both methods are equally good. We only need to use either one, not both. - 2 6. In the PMI project management methodology, Human Resources, Procurement, Risk and Communications management are classified as facilitating knowledge areas because: a. these are easier to manage than the other knowledge areas. b. these require sponsor's approval and the other knowledge areas do not. c. these are more important than the other knowledge areas. d. these are normally not considered as the success criteria of projects. 7. Which of the following statements is correct about cost baseline? a. It is the result of the cost estimating process. b. It is based on the Earned Value Management method. c. It is the same as the time baseline. d. It includes the original budget plus any approved changes to costs. 8. Which of the following statements is/are true about residual and secondary risks? (1) There will always be residual risks, but not necessarily secondary risks. (2) Secondary risks cannot be avoided whereas residual risks can be (3) Both of these risks are the results of some risk response strategies. a. (1) only. b. (2) only. (1) and (3) only. d. (1), (2) and (3) c.
5. The weighted scoring method can handle qualitative factors in financial analysis (option B).
6. In the PMI methodology, Human Resources, Procurement, Risk, and Communications are facilitating knowledge areas (option A).
7. The cost baseline includes the original budget and approved cost changes (option D).
8. Residual risks are always present, while secondary risks can be avoided (option A).
5. The correct answer is option b. The weighted scoring method can handle qualitative factors that may not be estimated numerically as required in financial analysis.6. The correct answer is option a. In the PMI project management methodology, Human Resources, Procurement, Risk, and Communications management are classified as facilitating knowledge areas because these are easier to manage than the other knowledge areas.7. The correct answer is option d. The cost baseline includes the original budget plus any approved changes to costs.8. The correct answer is option a. Residual risks will always be present, but not necessarily secondary risks. Secondary risks can be avoided, but residual risks can't. Both of these risks are the results of some risk response strategies.
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