Describe each of the four functions of money and provide an example of how money serves these roles.
What will be an ideal response?
Money's role as a medium of exchange occurs when money is used to purchase goods and services; for example, someone writes a check to buy groceries. Money's role as a unit of account occurs when prices of goods are quoted in terms of money; for example, stores in the United States almost invariably list prices in terms of dollars. Money's role as a store of value occurs because money can be used to buy goods and services in the future; for example, people keep money in their wallets over time in case they need it to buy something, though such cash earns no interest. Money's role as a standard of deferred payment occurs when loans are repaid in terms of money; for example, someone taking out a mortgage loan for $100,000 must repay interest plus the $100,000 in principal in dollars in the future.
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What does the debt to equity ratio show, and how is it calculated?
What will be an ideal response?
Before opening a letter of credit, a buyer frequently requests a __________________. This is the exporter's formal quotation, a description of the merchandise, price, delivery time, proposed method of shipment, terms of sale, and ports of exit and entry.
Fill in the blank(s) with the appropriate word(s).
This type of thought-sharing site typically provides the highest level of control for companies.
A. Flickr B. corporate blog C. Google+ D. personal blog E. professional blog
A container of ball-bearings valued at $25,000, currently located in Houston, TX, needs to be delivered to the Morton, IL, plant. The standard shipment method takes two days
However, for an additional charge of $500, the container can be sent overnight to arrive one day later. The annual holding cost rate for this type of item has been estimated at 28%. Which option is more economical?