EBK ECONOMICS: PRINCIPLES AND POLICY
13th Edition
ISBN: 9780100605930
Author: Blinder
Publisher: YUZU
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Question
Chapter 9, Problem 1DQ
To determine
Advantages and disadvantages of holding shares.
Expert Solution & Answer
Explanation of Solution
Instead of paying dividends, company decide to plow back its earning. There is some advantages and disadvantages for this can be listed as follows.
Advantages: the productive investment of the firm will increase its profitability with the value of the share. It will help the stock holder to earn a higher dividend or can sell the stock with a higher
Dis advantage: if the company decide to plow back its earning it have the possibility to block your cash income in the form of dividend.
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Students have asked these similar questions
The idea that a country can experience gains from trade means that it can
A) consume at a point outside its production possibilities frontier.
B) increase its exports.
C) increase the efficiency of its production.
D) experience a bowed-out production possibilities frontier.
A country is likely to have a comparative advantage in a land-intensive activity if it has a
A) alot of land relative to its population.
B) large population relative to its landmass.
C) higher opportunity cost of producing technology.
D) large amount of capital equipment relative to its population.
Florin and Guilder are two countries separated by a narrow sea. They use currencies called, respectively, the Flop and the Gulp.
Suppose the nominal exchange rate is 20 Flops per Gulp.
A Guilderian trader buys a 120 Flop barrel of Florish pickles by exchanging 6 Gulps, and a Florish trader buys a 4 Gulp crate of Guilderian apples by exchanging 80 Flops.
Then the Gulp depreciates to 10 Flops per Gulp.
Instructions: Enter your answers as whole numbers.
How much must the Guilderian pay for the same 120 Flop barrel of pickles?
Gulps
How much must the Florish trader pay for the same 4 Gulp crate of apples?
Flops
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