Allan and Rick Are Partners Who Share Profits and Losses

question 70

Multiple Choice

Allan and Rick are partners who share profits and losses in the ratio of 3:2 for Allan and Rick, respectively. They have capital balances of $40,000 and $47,000, respectively. If Tammy invests $32,000 for one-third interest, Tammy's capital balance will be: (Round your answer to the nearest dollar.)

• A) $39,667.
• B) $29,000.
• C) $32,000.
• D) $23,800.

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Definitions:

Excess Demand

A situation in a market where the quantity demanded of a good or service surpasses the quantity supplied at the current price, leading to upward pressure on prices.

Market Equilibrium

The state in which market supply equals market demand, and prices have no tendency to change, assuming all other factors remain constant.

Excess Supply

A situation in which the quantity of a good or service provided exceeds the quantity demanded at a given price.

Market Equilibrium

A state where the supply of a product matches its demand, resulting in stable prices.