Information for Hobson Corp. for the current year ($ in millions): Income from continuing operations before tax $ 150
Loss on discontinued operation (pretax) 30
Temporary differences (all related to operating income):
Accrued warranty expense in excess of expense
included in operating income 10
Depreciation deducted on tax return in excess of
depreciation expense 25
Permanent differences (all related to operating income):
Nondeductible portion of entertainment expense 5

The applicable enacted tax rate for all periods is 40%.

What should Hobson report as income from continuing operations?

answer: in the short-run firms will respond by raising the price of turkey.

explanation: initially the long-run equilibrium is at a price of $5 per pound of turkey and a quantity of 50 million pounds per year. now, when webmd claims that a protein found in turkey will increase your expected lifespan by 4 years. the consumers demand for turkey will increase at every price shifting the demand curve to the right from d1 to d2. while, there will be no change in the supply curve in the short-run as it is not possible for producers to adjust supply so quickly. as a result the new equilibrium will occur at a higher price and a higher quantity of turkey.

thus, in the short run firms will respond by increasing the price of turkey, selling more quantity at a higher price and earning economic profits.

credit history is used by lenders to determine whether you are a 'risky' person to give their money to.

having a short history provide very little data for the lenders. they wouldn't be able to determine your credit behavior from such a small samples. even if they are perfect.

having long credit history with few blemishes provide larger and more accurate data for the lenders to predict your credit behavior.