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Problem
1. Evaluate the following statement: "Enforcement is a major issue in Rotating Savings and Credit Associations (ROSCAs), yet ROSCAs do not easily fall apart in practice." Explain why.
2. Consider again the problem described in appendix 3A, and show that the expected utility of a participating member of a ROSCA is increasing with the number of members n. What problems may arise from having too many participants in a ROSCA?
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Double-entry Accounting Services begin operations on July 1. It allows its clients 90 days to pay for services received. On the other hand, the company's suppliers require payment for their goods and services within 30 days. Double-entry prepaid its ..
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