The opportunity cost of holding money suppose you've just inherited $10,000 from a relative. you're trying to decide whether to put the $10,000 in a non-interest-bearing account so that you can use it whenever you want (that is, hold it as money) or to use it to buy a u. s. treasury bond. the opportunity cost of holding the inheritance as money depends on the interest rate on the bond. what does the previous analysis suggest about the market for money? a) the quantity of money demanded increases as the interest rate rises. b) the supply of money is independent of the interest rate. c) the quantity of money demanded decreases as the interest rate rises.

Analyzing and computing accrued warranty liability and expense waymire company sells a motor that carries a 60-day unconditional warranty against product failure. from prior years' experience, waymire estimates that 2% of units sold each period will require repair at an average cost of $100 per unit. during the current period, waymire sold 69,000 units and repaired 1,000 units. (a) how much warranty expense must waymire report in its current period income statement? (b) what warranty liability related to current period sales will waymire report on its current period-end balance sheet? (hint: remember that some units were repaired in the current period.) (c) what analysis issues must we consider with respect to reported warranty liabilities?