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Suppose the government wants to increase farmers’ incomes. Why do price supports or acreage limitation programs cost society more than simply giving farmers money?
Price acreage and supports limitations cost society more than the dollar cost of these programs as the higher price that results in either case will decrease quantity demanded and hence consumer surplus, leading to a deadweight loss since the farmer is not able to capture the lost surplus. Giving the farmers money does not result in any type of deadweight loss, but is merely a redistribution of surplus from one group to another.
Specific Cost of Capital When the Cost of every source of capital is individually calculated, it is known as Specific Cost of Capital example Cost of equity, cost of debt, etc
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A treasury strip can be sold in two parts based on its components. When the investor is empowered with a right to receive the coupon payments on sale of its treas
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Why might it be very simple for an investor desiring to diversify his portfolio internationally to buy depository receipts as compared to the actual shares of the company? Answ
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It's a small amount of money which is used for initial market research or product development for a new venture.
Recent surveys of corporate exchange risk management practices point out that many U.S. firms simply do not hedge. How would you explain this result? Answer: There can be severa
Q. Nature of Financial Management? Financial Management is an necessary part of Top Management: - In the contemporary business management the financial manager is one of the ac
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