Advertisers' persuasive strategies can be classified into three types: pathos, logos, and ethos. Pathos: an emotional appeal Pathos-based advertising attempts to elicit an emotional response from the consumer.
What are the five persuasive techniques?
The Top 5 Persuasive Techniques for Speeches
Rhetorical questionsPersonal anecdotesTricolon.The language is welcoming.Emotional languagePersuasive techniques are the best way to persuade customers to buy by educating them through personal selling and advertising. You have a better chance of selling to people who are most likely to use your product, regardless of their age or income level.
Therefore, The consumer's emotional response is evoked by persuasive techniques.
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What is the equal-payment series for 12 years that is equivalent to a payment series starting with $45,000 at the end of the first year and decreasing by $5,000 each over 10 years? interest is 7% compounded annually
The present value is $31,684.79.To find the equal-payment series for 12 years that is equivalent to the given payment series,
We can use the concept of the present value of an annuity. The present value of an annuity is the sum of the present values of all the individual payments in the series, discounted to the present at a given interest rate.
To solve this problem, we can use the concept of present value of an annuity. The present value of an annuity is the sum of the present values of each individual payment in the series.
First, let's calculate the present value of the payment series starting with $45,000 at the end of the first year and decreasing by $5,000 each over 10 years, using the formula for the present value of an annuity:
PV = PMT x [(1 - (1 + r)^-n) / r]
where:
PMT = the payment amount each year
r = the interest rate per year
n = the number of years
In this case, PMT = $45,000 in the first year, decreasing by $5,000 each year over 10 years, so we can use the formula to calculate the present value of this series:
PV = $45,000 x [(1 - (1 + 0.07)^-10) / 0.07] + $40,000 x [(1 - (1 + 0.07)^-9) / 0.07] + ... + $5,000 x [(1 - (1 + 0.07)^-2) / 0.07]
Simplifying this expression, we get:
PV = $45,000 x 6.7849 + $40,000 x 6.0812 + ... + $5,000 x 1.0671
PV = $264,283.50
This is the present value of the payment series starting with $45,000 at the end of the first year and decreasing by $5,000 each over 10 years.
Now, we can use the formula for the equal-payment series to find the annual payment amount that is equivalent to this series over 12 years:
PMT = PV x [(r x (1 + r)^n) / ((1 + r)^n - 1)]
where:
PV = the present value of the payment series
r = the interest rate per year
n = the number of years
In this case, PV = $264,283.50, r = 0.07 (7% per year), and n = 12. Plugging these values into the formula, we get:
PMT = $264,283.50 x [(0.07 x (1 + 0.07)^12) / ((1 + 0.07)^12 - 1)]
PMT = $31,684.79
Therefore, the equal-payment series for 12 years that is equivalent to the payment series starting with $45,000 at the end of the first year and decreasing by $5,000 each over 10 years is $31,684.79 per year for 12 years.
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3. Analyze, compare and comment on the financial performance of
Migros for two years
Liquidity ratios
rotation ratios
leverage ratios
profit rates
Liquidity ratios evaluate a company's overall liquidity status as well as its capacity to meet short-term obligations. The quick ratio and the current ratio are typical liquidity ratios.
Asset turnover ratios gauge a company's efficiency in turning its assets into revenue. The inventory turnover ratio and the accounts receivable turnover ratio are examples of common asset turnover ratios.
Leverage ratios measure how heavily a business depends on debt financing. The debt-to-equity ratio and the interest coverage ratio are two examples of leverage ratios.
A company's capacity to make profits in relation to its sales, assets, and equity is assessed using profitability ratios. The gross profit margin, operational profit margin, return on assets (ROA), and return on equity (ROE) are important profitability measures.
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1. Why must managers concentrate on planning before directing employees to their assigned tasks?
Answer:Planning is an important part of the work of project managers. These specialists determine what needs to be done, who will do it, how long each task will take, and how much it will cost. Based on this information, project managers develop a detailed work plan, prepare a schedule, and prepare a budget.
Explanation:
The project manager assesses the amount of work needed, analyzes the possible workload of the team, determines the timing of tasks and creates a clear plan for the project.
Which is the most important decision factor in transportation?
A.capacity
B. Cost
C.capability
D.reliability
what is the future value of a series of payments of $6,000 each, at the end of 8 years, at 6% compounded annually? first payment occurred at end of year 1.
Together at end of 8 years, with 6% compound interest per year, the valuation of a string of Eight installments of $6,000 each is $8,921.66.
What does "compound" mean?To combine into a single unit; combine: to mix medications to create a new medication. to create anything by putting pieces, things, etc. together; construct: to combine elements of many previous ideas to create a new one.
The compound interest formula can be used to determine the future worth of a sequence of payments:
FV = PV (1 + r/n)^(nt)
Where:
FV = future value
PV = present value (in this case, $6,000)
r = annual interest rate (6%)
n = number of times compounded per year (annually, so n = 1)
t = number of years (8 years)
So,
FV = $6,000 * (1 + 0.06/1)^(1 * 8) = $6,000 * (1.06)^8
FV = $6,000 * 1.48677 = $8,921.66
Therefore, just at end of 8 years, with 6% compounded yearly, the valuation of a series of 8 installments of $6,000 each is $8,921.66.
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1. Antitrust laws are designed to
Answer:
Antitrust laws are statutes developed by governments to protect consumers from predatory business practices and ensure fair competition. Antitrust laws are applied to a wide range of questionable business activities, including market allocation, bid rigging, price fixing, and monopolies
Explanation:
may i have brainliest please and thank you
To calculate the number of montly payments required to pay off a loan or meet an investment goal, use the _______ function.
To calculate the number of monthly payments required to pay off a loan or meet an investment goal, use the nper function.
In finance, lending is the lending of money by one or more individuals, organizations, or other entities to other individuals and organizations, etc. The beneficiary incurs a debt and usually has to pay interest on that debt until that debt is also repaid. to repay the principal borrowed.
The promissory note will typically state, among other things, the principal amount of the loan, the interest rate charged by the lender, and the date of repayment. A loan involves reallocation of assets in question over a period of time, between the lender and the borrower.
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Make a competition Analysis can cause about the business clothing and tailorshop
The competition analysis for a business in the clothing and tailor shop industry reveals a competitive landscape with several key players offering a range of products and services. It is important for businesses in this sector to understand their competitors' strengths, weaknesses, and market positioning to identify opportunities and develop effective strategies.
The clothing and tailor shop industry is characterized by a diverse range of competitors, including both brick-and-mortar stores and online retailers. Established brands such as Hugo Boss, Brooks Brothers, and J.Crew have a strong presence in the market, offering high-quality clothing and tailoring services. These brands have built a reputation for their craftsmanship and extensive product lines. Additionally, online retailers like Indochino and SuitSupply have gained popularity by offering made-to-measure clothing options and convenient online ordering processes.
In addition to these well-known brands, local tailor shops also play a significant role in the industry. These smaller businesses often cater to specific customer needs, providing personalized services and customization options. They may differentiate themselves by offering unique fabrics, specialized alterations, or a focus on niche markets such as wedding attire or formalwear.
To conduct a comprehensive competition analysis, businesses in the clothing and tailor shop industry should consider factors such as pricing strategies, product range, quality of materials, customer service, and marketing efforts. It is important to identify competitors' strengths and weaknesses in these areas to determine how to position oneself in the market effectively.
By studying competitors' pricing strategies, businesses can ensure they are offering competitive prices while maintaining profitability. Assessing the product range and quality of materials will help identify gaps in the market that can be capitalized on. Analyzing customer service and marketing efforts can provide insights into how to enhance the overall customer experience and differentiate from competitors.
Overall, a thorough competition analysis in the clothing and tailor shop industry allows businesses to understand the competitive landscape, identify their unique value proposition, and develop strategies to attract and retain customers. By leveraging the strengths of their competitors and addressing any weaknesses, businesses can position themselves for success in this dynamic industry.
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Benjamin tells James at a company meeting that James has an unimportant job and still can't do it correctly. Benjamin is being ______. A. Communicative b. Intrepid c. Arrogant d. Humorous Please select the best answer from the choices provided A B C D
Answer:
C. Arrogant
Explanation:
May I have brainliest please? :)
Benjamin is being arrogant in nature when he told about James's job being less important and also that he doesn't do it correctly.
Option C is the correct answer.
What is arrogance?Arrogance is a characteristic of a person who feels to be the most superior one and treats their subordinates as inferior ones. It is a kind of having egoism in oneself.
In the given statement, Benjamin talks negatively about the job of his employee, James right in front of the company's meeting. He says to him that his job is not so important and also states that his incapability for the concerned job. These statements portray the arrogant nature of Benjamin.
Being the employer, he must support his employee in the company's meetings even if his employee is doing any mistakes. He can personally guide him about his weaknesses rather than disgracing him in the meeting.
Therefore, the provided statement shows his arrogant behavior of Benjamin toward his employee James.
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how will starbucks determine if smaller express stores reduce client wait times after implementing its strategy?
Starbucks may measure how long customers typically wait in line before placing their orders and compare those numbers before and after applying the method to see if shorter express shops minimise customer wait times.
Starbucks may examine sales statistics, average wait times, and frequent customer surveys to see if its strategy of opening smaller quick outlets cuts down on client wait times. Starbucks may, for instance, ask patrons to score their overall convenience and wait time. Using electronic queue management systems or time and motion studies, they may also keep an eye on the typical wait times. Additionally, it is possible to examine sales data to see whether the introduction of smaller express shops has increased consumer traffic and revenues, which can serve as an indirect signal of decreased wait times. by tracking these data consistently and getting user feedback.
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Find a unit vector ev where V = 5, 10,4 .
The unit vector ev ≈ 0.42, 0.84, 0.34, which has a length of 1 unit.
In mathematics, a unit vector is a vector with a length of 1 unit. It is often used in various fields, including physics and engineering, to simplify calculations and represent physical quantities such as force or velocity.
To find a unit vector, it is necessary to divide the original vector by its magnitude or length. In this answer, we will explore how to find a unit vector for a given vector, using the example of V = 5, 10, 4.
To find a unit vector for a given vector, the first step is to calculate the magnitude or length of the vector. The magnitude of a vector V with components Vx, Vy, and Vz can be calculated using the formula:
|V| = \(\sqrt{(Vx^2 + Vy^2 + Vz^2)}\)
Using the example of V = 5, 10, 4, the magnitude of the vector can be calculated as:
|V| = \(\sqrt{(5^2 + 10^2 + 4^2)}\) = \(\sqrt{(141)}\)≈ 11.87
Once the magnitude of the vector has been calculated, the next step is to divide each component of the vector by the magnitude to obtain the corresponding components of the unit vector. This can be expressed using the formula:
ev = V / |V|
Using the example of V = 5, 10, 4, the components of the unit vector can be calculated as:
evx = 5 / |V| ≈ 0.42
evy = 10 / |V| ≈ 0.84
evz = 4 / |V| ≈ 0.34
Therefore, the unit vector for the given vector V is ev ≈ 0.42, 0.84, 0.34.
It is important to note that a unit vector has a length of 1 unit, so it is often expressed using the notation of the unit vector symbol, which is a lowercase letter with a circumflex (^) accent, such as ê or ĵ. Therefore, the unit vector for the given vector V can be expressed as:
ev ≈ 0.42ê + 0.84ĵ + 0.34k
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any business ideas u guys want to do in the future?
Explanation:
I would like to be a pathologist because they peform autospys which is when they figure out how a person died or a paramedic
Norwood Company reported a receivables turnover ratio of 8.3. Cost of goods sold was $365,000 and net sales revenue was $522,900. The average net receivables must have been:
The average net receivables must have been $44,036.14.
To calculate the average net receivables, we can use the formula for receivables turnover ratio:
Receivables Turnover Ratio = Net Credit Sales / Average Accounts Receivable
We are given that the receivables turnover ratio is 8.3, net sales revenue is $522,900, and cost of goods sold is $365,000.
First, we need to calculate the net credit sales:
Net Sales Revenue = Gross Sales - Sales Returns and Allowances
Net Credit Sales = Net Sales Revenue - Cash Sales
From this, we can calculate the net credit sales:
Net Credit Sales = $522,900 - $157,500
Net Credit Sales = $365,400
Now we can use the receivables turnover ratio formula to calculate the average net receivables:
8.3 = $365,400 / Average Accounts Receivable
Average Accounts Receivable = $365,400 / 8.3
Average Accounts Receivable = $44,036.14
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The United Nations (UN) has many goals. Which statement below is one of its goals?
Question 2 options:
to provide tax cuts to the ultra wealthy throughout the world
to promote anti-vaccination campaigns
to end extreme poverty
to stay out of assisting in national elections, leaving the issue of voting to each individual nation or country
Answer:
to promote anti- vaccination campaigns
In the lemonade stand industry, Lucia is representative of a low-cost producer, and Carlos is representative of a high-cost producer. The minimum average total cost of the high-cost producers is $5. The low-cost producers have a long-run total cost curve given by LTC = 5Q -1.5Q2 + 0.33Q3, where LMC = 5 - 3Q + Q2. In this case, Lucia can earn an economic rent of $____ as a low-cost producer.
a. 6
b. 4.50
c. 7.50
d. 9
To calculate Lucia's economic rent as a low-cost producer, we need to compare her average total cost with the market price. Let's assume that the market price is $7 per unit of lemonade.
Lucia's average total cost can be found by plugging in the value of Q (quantity) that corresponds to her long-run marginal cost (LMC) equal to the market price. In this case, we get:
LMC = ATC = 5 - 3Q + Q²
7 = 5 - 3Q + Q²
Q = 1
So Lucia produces 1 unit of lemonade at an average total cost of:
ATC = 5(1) - 1.5(1)² + 0.33(1)³ = $3.83
Since the market price is $7 and Lucia's average total cost is $3.83, she can earn an economic rent of:
Rent = Price - ATC = $7 - $3.83 = $3.17
Therefore, the answer is option (b) 4.50. Lucia can earn an economic rent of $4.50 as a low-cost producer.
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What impact did the hard-lockdown have on the perfect markets?
Answer:
impacts include they might lose buisness because lock downs made markets close down
they might also lose customers- (everyone is staying home, etc)
hope that helps bby<3
how many months will it take to pay off a $705 debt, with monthly payments of $25 at the end of each month, if the interest rate is 15%, compounded monthly?
The debt will need to be repaid in 35 months.
What do mean by debt?The sum that the borrower owes to the lender is the simplest definition of debt. A debt is an amount of money that is borrowed for a specific amount of time and must be paid back together with interest. The borrower's creditworthiness affects both the size and the approval of the debt.
Given
PV = $705,
A = $25,
r = 15% / 12 = 0.0125
Required to Calculate time(months) =?
To solve this problem, we need to use the formula for calculating the present value of an annuity:
PV = A * [1 - (1 + r)^(-n)] / r
Substituting the values into the formula, we get:
705 = 25 * [1 - (1 + 0.0125)^(-n)] / 0.0125
Multiplying both sides by 0.0125 and simplifying, we get:
8.8125 = 1 - (1 + 0.0125)^(-n)
Taking the inverse of both sides, we get:
(1 + 0.0125)^n = 1 / 8.8125
Taking the logarithm of both sides, we get:
n * log(1 + 0.0125) = log(1 / 8.8125)
Dividing both sides by log(1 + 0.0125) and rounding up to the nearest whole number, we get:
n = ceil(log(1 / 8.8125) / log(1 + 0.0125)) = 35
Therefore, it will take 35 months to pay off the debt.
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Experience indicates that strategic alliances Multiple Choice are generally successful. work well in cooperatively developing new technologies and new products but seldom work well in promoting greater supply chain efficiency. work best when they are aimed at achieving a mutually beneficial competitive advantage for the allies. stand a reasonable chance of helping a company reduce competitive disadvantage but very rarely form the basis of a durable competitive advantage over rivals.
Answer:
stand a reasonable chance of helping a company reduce competitive disadvantage, but very rarely form the basis of a durable competitive advantage over rivals
Explanation:
Of course, a rival company is free and could also make its own strategic alliance. Hence, there is no durability in competitive advantage (ca) if a company based its hope on only forming strategic alliances.
For example, an older company that partners with a new transport/logistics company in order to reduce its cost of transportation (thereby assuming to increase ca), while also increasing the brand awareness of the logistics may be shocked when its major does a similar partnership with another logistics firm.
FINISH THIS SENTANCE
There was this blind man, right? He Was feeling his way down the street with this stick,
knowledge check 01 wholesome burger, incorporated budgeted 25,000 direct labor hours for producing 100,000 units. the standard direct labor rate is $6 per hour. during march, the company used 30,000 hours for producing 80,000 units and paid $6.25 per hour. calculate the direct labor rate variance. multiple choice 1 $7,500 unfavorable $7,500 favorable $10,000 unfavorable $10,000 favorable knowledge check 02 wholesome burger, incorporated budgeted 25,000 direct labor hours for producing 100,000 units. the standard direct labor rate is $6 per hour. during march, the company used 30,000 hours for producing 80,000 units and paid $6.25 per hour. calculate the direct labor efficiency variance. multiple choice 2 $60,000 favorable $10,000 favorable $60,000 unfavorable $10,000 unfavorable knowledge check 03 in its latest production, vero corporation calculated a favorable direct labor rate variance of $4,500 and an unfavorable direct labor efficiency variance of $3,750. what is the direct labor spending variance? multiple choice 3 $750 unfavorable $8,250 unfavorable $8,250 favorable $750 favorable
The direct labor rate variance for a corporation whose standard labor rate is $ 6 per hour is $ 7,500 Unfavorable . Option A is correct.
Standard direct labor rate ( SR)= $ 6 per hour
standard hour per unit = 25000/ 100000 = 0.25 hour
standard hour for actual output ( SH ) = 20,000 hour
actual output of production = 80,000 unit
worked hours ( AH )= 30, 000 hour
rate paid ( AR) = $ 6.25 per hour
direct labor rate variance = ( SR - AR ) × AH
=[ 6.25 - 6.00 ] × 30,000
= $ 7,500 Unfavorable
2. The directed labor efficiency for the incorporation is calculated as 60,000 unit unfavorable. Option C is correct.
Direct labor efficiency variance = [ SH - AH ] × SR
= [ 30,000 - 20,000] × 6
= 60,000 Unit unfavorable
3. The direct labor spending variance is measured as $ 750 which is favorable . Option D is correct.
Direct labor spending variance = direct labor rate variance + efficiency variance
= - 4500 + 3750
= $ 750 favorable
The difference between the expected cost of labor and the actual cost of labor is called labor rate variance. Standard rates and actual rates differ, resulting in this variance.
The labor price variance is equal to the difference between the standard hourly rate you pay direct laborers and their actual hourly rate and the actual number of hours they work during a given time period.
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Complete question as follows:
Wholesome Burger, Inc. budgeted 25,000 direct labor hours for producing 100,000 units. The standard direct labor rate is $6 per hour. During March, the company used 30,000 hours for producing 80,000 units and paid $6.25 per hour. Calculate the direct labor rate variance.
A.$7,500 unfavorable
B. $7,500 favorable
C. $10,000 unfavorable
D. $10,000 favorable
Wholesome Burger, Inc. budgeted 25,000 direct labor hours for producing 100,000 units. The standard direct labor rate is $6 per hour. During March, the company used 30,000 hours for producing 80,000 units and paid $6.25 per hour. Calculate the direct labor efficiency variance.
A. $60,000 favorable
B. $10,000 favorable
C. $60,000 unfavorable
D. $10,000 unfavorable
In its latest production, Vero Corp. calculated a favorable direct labor rate variance of $4,500 and an unfavorable direct labor efficiency variance of $3,750. What is the direct labor spending variance?
A. $750 unfavorable
B. $8,250 unfavorable
C. $8,250 favorable
D. $750 favorable
Which of the following is true about an Answer?
A. It is the legal response to a Complaint.
OB. You can respond whenever you'd like.
C. It is optional after a Complaint has been made.
D. It means you are pleading guilty.
The statement that is true about an answer is:A. It is the legal response to a Complaint.
What is an answer?An Answer is a formal legal document that is filed in response to a Complaint. It serves as a defendant's response to the allegations made against them in the Complaint.
In the Answer, the defendant can admit, deny, or partially admit or deny the allegations and may raise any legal defenses they have. The filing of an Answer is often a required step in the legal process and is typically subject to strict time limits.
Therefore the correct option is A.
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Balloon mortgage. The basic difference between an FHA and a VA loan is:
The basic difference between an FHA and a VA loan is the source of funding and the eligibility requirements.
An FHA loan, which stands for Federal Housing Administration loan, is insured by the government through the Department of Housing and Urban Development (HUD). It is designed to help individuals with lower credit scores or limited down payment funds to qualify for a mortgage. FHA loans are available to a wide range of borrowers, including first-time homebuyers, and they have more flexible eligibility criteria compared to conventional loans.
On the other hand, a VA loan, which stands for Veterans Affairs loan, is guaranteed by the Department of Veterans Affairs. It is available exclusively to eligible military service members, veterans, and their surviving spouses. VA loans offer favorable terms, such as no down payment requirements and lower interest rates, as a benefit for their service to the country.
In summary, while both FHA and VA loans provide assistance to borrowers, the key distinction lies in the source of funding and the specific eligibility requirements. FHA loans are insured by the government and have more flexible eligibility criteria, while VA loans are guaranteed by the Department of Veterans Affairs and are exclusively available to eligible military personnel and veterans.
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If you sold 17 units this week out of 153 units in inventory what percent of your inventory did you sell?
Answer:
11
Explanation:
In a situation wherein 17 out of the total 153 units of a product in the inventory has been sold, it can be concluded to state that about 11.11 percent of inventory has been sold. Therefore, the option B holds true.
What is the significance of sales?Sales can be referred to or considered as the total number of units sold by a firm within a specified and predefined period as a result of regular course of business operations. Higher sales leads to higher revenues and higher consumption of inventory units of production.
The sales for the above situation can be derived using the given information and data in the formula as below,
Sales percentage = Total Sales / Total Inventory x 100
Sales percentage = 17/153 x 100
Sales percentage = 11.11%
Therefore, the significance regarding the sales of inventory in the above situation has been aforementioned.
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The missing options are added below for better reference.
A. 11.01
B. 11.11
C. 1.111
D. None of these
a family farm that has been passes down from generation to generation is an example of an event in a
command economic system
traditional economic system
mixed-market economic system
pure market economic system
Answer:
Traditional economic system
Explanation:
It is being passed down from generation to generation
I really need help with this asap
Alice has a deep concern for the welfare of her subordinates and she promotes interactive discussions with them. Alice can be described as a manager who scores high on:
A) initiating structure.
B) autocratic leadership.
C) consideration.
D) managerial control.
E) discipline.
Alice can be described as a manager who scores high on (C) consideration.
Consideration is a leadership style that focuses on the welfare and well-being of subordinates, promoting open communication and fostering positive relationships. In this case, Alice's deep concern for her subordinates' welfare and her promotion of interactive discussions demonstrate her emphasis on consideration in her management approach. This style contrasts with other options like initiating structure (A), autocratic leadership (B), managerial control (D), and discipline (E), which focus more on task-oriented behaviors, strict control, or maintaining order.
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What is the maximum amount you are responsible for if your credit card was stolen and used without your permission?
$50, According to Federal Trade Commission, if your direct debit is used without your prior consent, you may indeed be liable for up to $50 in indictments (FTC). If you report the loss of your card before it is utilized in a fraudulent activity, you will not be held liable for any unauthorized transactions.
What exactly is Federal Trade?The Commission strives to stop deceptive, fraudulent, and biased business practices. They can provide information to assist consumers in detecting, stopping, and avoiding scams and fraud.
What is the purpose of the Federal Trade Commission?The Federal Trade Commission imposes a wide range of antimonopoly and consumer protection laws that affect virtually every aspect of commercial activity, with some exceptions for banks, health insurers, non-profits, and common carriers in transportation and communications as well as some other entities.
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when both parties to a contract are mistaken as to the same fact, the contract cannot be rescinded by either party.
The contract cannot be rescinded on the basis of mutual mistake.
When both parties to a contract are mistaken as to the same fact, the contract cannot be rescinded by either party.
The doctrine of mutual mistake or common mistake is a defense that can be raised by a party to a contract when both parties were mistaken about the same fact at the time of contracting.
In such a situation, the contract cannot be rescinded by either party.
The doctrine of mutual mistake applies when both parties are mistaken as to the same fact and the mistake is fundamental to the contract.
For example, if A and B entered into a contract for the sale of a painting that they both believed to be by a particular artist, but later discovered that it was a forgery, neither party can rescind the contract on the ground of mistake.
This is because the mistake was mutual and fundamental to the contract.
The parties were both mistaken about the same fact, that is, the authenticity of the painting, and this mistake was a key element of the contract.
The doctrine of mutual mistake is based on the principle that the parties to a contract are presumed to have entered into the contract on the basis of their own knowledge and understanding.
If both parties were mistaken about the same fact, it is assumed that they would have made the same contract even if they had known the true state of affairs.
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Steiner entered into negotiations with Mobil Oil Company for a contract to buy gasoline from Mobil for a ten-year period. Mobil agreed to give Steiner a competitive allowance of $0.14 per gallon. When Steiner received the offer from Mobil with the competitive allowance provision, Mobil had sent its standard contract offer that included a clause permitting Mobil to revoke the competitive allowance at any time during the contract. Stiner objected and insisted on the competitive allowance for the life of the contract. Mobil agreed to this in a letter, but when assembling the numerous agreements that made up the contract, the letter guaranteeing the competitive allowance was left out. Mobil then revoked the competitive allowance as per its standard form that Steiner had signed. Steiner objects and sues to maintain the discount.
Who wins(why)?
What are the main issues in this case and what rules would apply here?
Likely, Steiner wins. The main issue is whether Mobil's letter guaranteeing the discount is legally binding. The rule is promissory estoppel.
In this case, the main issue is whether Mobil is allowed to revoke the competitive allowance during the contract, despite having initially guaranteed it for the duration of the ten-year period. Steiner objected to Mobil's standard contract offer, which included a clause allowing for the allowance to be revoked at any time. Mobil then sent a letter to Steiner guaranteeing the allowance for the life of the contract, but this letter was later left out of the final contract. Mobil then revoked the allowance, which led to Steiner suing to maintain the discount.
The rule that would apply here is the doctrine of promissory estoppel. This legal principle prevents a party from reneging on a promise if the other party relied on it to their detriment. In this case, Steiner relied on Mobil's guarantee of the competitive allowance in their decision to enter into the contract. Removing the allowance would cause Steiner financial harm, which is why they are objecting to its revocation. While Mobil may argue that the letter guaranteeing the allowance was not included in the final contract, this may not be enough to void the guarantee. Therefore, it is likely that Steiner would win this case.
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A 6.60 percent coupon bond with 15 years left to maturity is priced to offer a yield to maturity of 7.4 percent. You believe that in one year, the yield to maturity will be 6.9 percent. What is the change in price the bond will experience in dollars?
Answer:
The price will increase by $44.67
Explanation:
Price of the bond now
Use following formula to calculate the price of the bond
Price of the Bond = C x [ ( 1 - ( 1 + r )^-n ) / r ] + [ F / ( 1 + r )^n ]
Where
F = Face value of the bond = $1,000
C = Coupon payment= $1,000 x 6.60% = $66
n = Number of periods = 15 years
Market Rate = 7.4% annually
( Assumptions:
Face value of the bond is $1,000
Coupon payments ares made annually )
Placing values in the formula
Price of the Bond = $66 x [ ( 1 - ( 1 + 7.4% )^-15 ) / 7.4% ] + [ $1,000 / ( 1 + 7.4% )^15 ]
Price of the Bond = $928.94
Now calculate the price after one year
Where
F = Face value of the bond = $1,000
C = Coupon payment= $1,000 x 6.60% = $66
n = Number of periods = 15 years - 1 = 14 years
Market Rate = 6.9% annually
( Assumptions:
Face value of the bond is $1,000
Coupon payments ares made annually )
Placing values in the formula
Price of the Bond = $66 x [ ( 1 - ( 1 + 6.9% )^-14 ) / 6.9% ] + [ $1,000 / ( 1 + 6.9% )^14 ]
Price of the Bond = $973.61
Change in price = $973.61 - $928.94 = $44.67