People often convey the idea behind MM’s proposition 1 by various supermarket analogies, for example, “The value of a pie should not depend on how it is sliced,” or, “The cost of a whole chicken should equal the cost of assembling one by buying two drumsticks, two wings, two breasts, and so on.” Actually proposition 1 doesn’t work in the supermarket. You’ll pay less for an uncut whole pie than for a pie assembled from pieces purchased separately. Supermarkets charge more for chickens after they are cut up. Why? What costs or imperfections cause proposition 1 to fail in the supermarket? Are these costs or imperfections likely to be important for corporations issuing securities on the U.S. or world capital markets? Explain.
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- As inflation rises, people will tend to go to the bank more often. This is known as menu costs. go to the bank more often. This is known as shoeleather costs. go to the bank less often. This is known as the inflation fallacy. go to the bank less often. This is known as redistribution costsarrow_forwardWhich of the following statements is most accurate? A stop-sell order is placed by a bullish investor above the current market price. A stop-buy order is placed by a bearish investor above the current market price. A stop-sell order is placed by a bearish investor below the current market price. A stop-sell order is placed by a bullish investor at the current market price. A stop-sell order is placed by a bearish investor at the current market price.arrow_forwardWhen considering trade of two goods between Ann and Bob, if both have preferences that satisfy "more is better, "then it is always Pareto efficient to give all of both goods to Ann. it is always Pareto efficient to split the two goods equally between Ann and Bob. both of the above are true. none of the above are true.arrow_forward
- Within the general functions of packaging, specific functions are performed. One of those specific functions is "apportionment," which can be defined as: Multiple Choice О Allowing products to be used with little wasted effort by customers. о To protect the contents of the package from damage or loss. Translating the large output of manufacturing into smaller quantities of greater use to customers. О The use of unambiguous, readily understood wording, symbols or pictures. О None of the options are definitions of apportionment.arrow_forwardWhen dealing with Make or Buy - we have several alternatives that could be possible. Like with any problem associated with relevant decision making, we have to list all of our alternatives side by side and choose the best one. Yet, as we've discussed, there are items that are important that can be non-financial. For instance, if a series of alternatives suggests we should drop a product line because the numbers say it'd be a good move, do we just do it? What about the political fall out? The loss of jobs? All of these things need to be weighed when making these all to complicated decisions.arrow_forwardIf you know the cash value components but are unsure of the noncash value of a job offer, what should you do? O Accept the job but immediately look for a new one. Ask questions about noncash values to get more information. O Turn down the job. O Accept the job and figure it out as you go.arrow_forward
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- Which of the following is not a central problem of an economy? A) What to produce B) How to produce C) For whom to produce D) When to produce Don't use chatgpt or other ai tool. If you know correct answer then attempt if you gave wrong answer I will give 10 dislikes and more from my friends accountarrow_forwardindustria cataria pieretti wants you to deliver the goods to the port of genova . however cataria pieretti will assume the risk for the goods once they are loaded into the container which icoterm is used here ?arrow_forward
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