Economics, Accounting & Business: Post your doubts here!

[Sana Adnan]

Why is the ans B?Wouldnt an increase in interest rate only increase demand,hence shifting that?why shift the supply curve?View attachment 51850

Is it because the interest increase would give incentive to save for domestic people too and hence they would also not import much,and that will reduce supply?Am i right in this?

asadalam
When interest rates in UK are increased it will offer a greater incentive to save to consumers triggering them to save more in banks rather than spending money. Likewise cost of borrowing will also increase due to higher interest rates and people will borrow less money. This will cause money supply in UK to decrease which explains the shift in Supply Curve to S2S2

 

[asadalam]

How is the answer B?Shouldnt a change in price cause a movement along the demand curve?

Sana Adnan

 

[Sana Adnan]

How is the answer B?Shouldnt a change in price cause a movement along the demand curve?


Sana Adnan

asadalam

Yes. you are right. Changes in price of a good causes a moment along the demand curve for that good. But if you read the question carefully, the given Demand and Supply curve is for Petrol, while there is a change in price for cars. This means that the Petrol prices are unchanged. Notice that Petrol and Cars are complementary or Jointly-demanded goods. So if price of cars fall, there will be an extension in quantity demand of cars (movement along demand curve of cars). But, an increase in demand for cars automatically means that the demand for petrol will also increase despite that the price of petrol is unchanged. As a result there will be an upward shift in the demand curve for petrol. Hope this explains the concept.

 

[asadalam]

asadalam

Yes. you are right. Changes in price of a good causes a moment along the demand curve for that good. But if you read the question carefully, the given Demand and Supply curve is for Petrol, while there is a change in price for cars. This means that the Petrol prices are unchanged. Notice that Petrol and Cars are complementary or Jointly-demanded goods. So if price of cars fall, there will be an extension in quantity demand of cars (movement along demand curve of cars). But, an increase in demand for cars automatically means that the demand for petrol will also increase despite that the price of petrol is unchanged. As a result there will be an upward shift in the demand curve for petrol. Hope this explains the concept.

Oh,i see,i misread the question and didnt read it said cars,not petrol. Thanks a lot!

 

[Sana Adnan]

Cie A2 economics is too tough...plzzzz help!!!

Mahreen Mustafa
What kind of help are you looking for. Please post your question or tag me. Alternatively you can visit my blog http://sanaadnan.wordpress.com for some helpful resources

 

[lxelle]

azaanahsan Or student8 Hello! Could you help me with a few questions? Thanks in adv.
1. At the beginning of the year a company has authorised share capital of 800000 of odinary shares of $0.25 each and an issued share capital of 400000 ordinary shares of $0.25. During the year the company makes a further issue of 200000 ordinary share at a price of $0.60 What is the balance on the share capital account at the end of the year?
2. Question 6,7 and 9. http://onlineexamhelp.com/wp-content/uploads/2012/06/9706_s08_qp_3.pdf
3. Question no. 22 http://onlineexamhelp.com/wp-content/uploads/2014/08/9706_s14_qp_33.pdf

 

[abdulrehmansays]

Can anyone help explain part c) i) only!
Answer sheet says.... 165000-110000=55000
But CRR = par value of shares redeemed - proceeds from issue of new shares
Going that way answer should have been 150000-110000=40000

 

[lxelle]

View attachment 51924
Can anyone help explain part c) i) only!
Answer sheet says.... 165000-110000=55000
But CRR = par value of shares redeemed - proceeds from issue of new shares
Going that way answer should have been 150000-110000=40000

Hi! Idk if you could help me with my ques? :3

 

[abdulrehmansays]

azaanahsan Or student8 Hello! Could you help me with a few questions? Thanks in adv.
1. At the beginning of the year a company has authorised share capital of 800000 of odinary shares of $0.25 each and an issued share capital of 400000 ordinary shares of $0.25. During the year the company makes a further issue of 200000 ordinary share at a price of $0.60 What is the balance on the share capital account at the end of the year?

400,000 of $0.25 = $100,000
200,000 of $0.60 = $50,000 of OS ($0.25*200,000) and $70,000 of share premium!
Total OS: $150,000 and SP: $70,000

 

[lxelle]

400,000 of $0.25 = $100,000
200,000 of $0.60 = $50,000 of OS ($0.25*200,000) and $70,000 of share premium!
Total OS: $150,000 and SP: $70,000

Thanks! How bout the others?

 

[abdulrehmansays]

2. Question 6,7 and 9. http://onlineexamhelp.com/wp-content/uploads/2012/06/9706_s08_qp_3.pdf

6- 2000 would be the answer as CRR includes par value of shares redeemed and not the premium!
7- 200,000*1.25 + 20000 = 270,000 - fair value i.e. 200,000 = 70,000 GW= purchase price - fare market value!
9- [80k-(150k-liability)] = -30
Liability = 40k....

 

[lxelle]

6- 2000 would be the answer as CRR includes par value of shares redeemed and not the premium!
7- 200,000*1.25 + 20000 = 270,000 - fair value i.e. 200,000 = 70,000 GW= purchase price - fare market value!
9- [80k-(150k-liability)] = -30
Liability = 40k....

Could you do the workings for no. 6? D:

 

[abdulrehmansays]

Budgeted profit = 60,000
Profit/ unit = 2
60,000/2 = 30,000 i.e. the number of units sold!
30,000*6(FC)= 180,000 i.e. the total fixed cost!
Selling price/unit - Variable cost/unit = Contribution/ unit
12-4= 8
Total FC/Contribution/unit = Breakeven point
180,000/8 = 22500
30,000-22,500= 7500
7500/ 30000 * 100 = 25%

azaanahsan Or student8 Hello! Could you help me with a few questions? Thanks in adv.
1. At the beginning of the year a company has authorised share capital of 800000 of odinary shares of $0.25 each and an issued share capital of 400000 ordinary shares of $0.25. During the year the company makes a further issue of 200000 ordinary share at a price of $0.60 What is the balance on the share capital account at the end of the year?
2. Question 6,7 and 9. http://onlineexamhelp.com/wp-content/uploads/2012/06/9706_s08_qp_3.pdf
3. Question no. 22 http://onlineexamhelp.com/wp-content/uploads/2014/08/9706_s14_qp_33.pdf

 

[abdulrehmansays]

Could you do the workings for no. 6? D:

There are no workings! When u redeem shares without issues then u make a CRR with the nominal value, subtract that value from retained profits, share premium is subtracted from retained earnings!

 

[lxelle]

There are no workings! When u redeem shares without issues then u make a CRR with the nominal value, subtract that value from retained profits, share premium is subtracted from retained earnings!

So, i just take that value from preference share cap? D: Sorry I suck at this topic, a lot!

 

[abdulrehmansays]

So, i just take that value from preference share cap? D: Sorry I suck at this topic, a lot!

Yes.... This might help you!

 

[lxelle]

Yes.... This might help you!

thanks a bunch ! You really helped me a lot! You don't mind if I ask you more ques next time right?

 

[azaanahsan]

thanks a bunch ! You really helped me a lot! You don't mind if I ask you more ques next time right?

sorry I got late ...

 

[abdulrehmansays]

sorry I got late ...

Can you answer my question?

 

[azaanahsan]

Can you answer my question?

I will try Please .....