Answer and Explanation:
The computation of the weighted-average number of shares outstanding in each cases is as follows:
a. At the time when the shares are issued at cash
= (303,000 × 12 ÷ 12) + (31,200 × 8 ÷ 12)
= 303,000 + 20,800
= 323,800 shares
b. At the time when the shares are issued in the stock dividend
= (303,000 × 12 ÷ 12) + (29,700 × 12 ÷ 12)
= 303,000 + 29,700
= 332,700 shares
Cool Sky reports the following costing data on its product for its first year of operations. During this first year, the company produced 40,000 units and sold 32,000 units at a price of $110 per unit. Manufacturing costs Direct materials per unit $ 42 Direct labor per unit $ 16 Variable overhead per unit $ 5 Fixed overhead for the year $ 360,000 Selling and administrative costs Variable selling and administrative cost per unit $ 10 Fixed selling and administrative cost per year $ 115,000 1a. Assume the company uses absorption costing. Determine its product cost per unit.
Answer:
Cool Sky
The product cost per unit under absorption costing is:
= $7.20
Explanation:
a) Data and Calculations:
First year production units = 40,000
First year sales units = 32,000
Ending inventory = 8,000 (40,000 - 32,000)
Selling price per unit = $110
Sales revenue = $3,520,000 (32,000 * $110)
Manufacturing costs
Direct materials per unit $ 42
Direct labor per unit $ 16
Variable overhead per unit $ 5
Fixed overhead for the year $ 360,000
Selling and administrative costs:
Variable selling and administrative cost per unit $ 10
Fixed selling and administrative cost per year $ 115,000
Production Cost per Unit under Absorption Costing:
Manufacturing costs: Unit Total
Direct materials per unit $ 42
Direct labor per unit $ 16
Variable overhead per unit $ 5
Total variable cost per unit $63 $2,520,000
Fixed overhead for the year $ 360,000
Total production cost for 40,000 $2,880,000
Unit product cost = $7.20 ($2,880,000/40,000)
In reviewing activity for july the controller of mathis inc., collected the following data concerning direct materials:
Actual production $103,000 units
Direct materials purchased (actual) $1,642,800
Standard cost of materials purchased $1,554,000
Standard direct materials costs per unit produced 14
Standard price times actual amount of materials used $1,405,950
Required:
Compute the direct materials cost variances.
Answer:
$36,400 U
Explanation:
Actual costs = $ 1,643,800
Actual inputs at standard price = $ 1,556,500
Price variance = ($ 1,556,500 – $1,643,800)
= $87,300 Unfavorable
Actual inputs at standard price = $ 1,408,450
Flexible budget (Standard Allowed for Good Output):
= $14.1 × 103,500
= $1,459,350
Efficiency variance = ($1,459,350 - $1,408,450)
= $50,900 Favorable
Direct materials cost variances:
= Price variance - Efficiency variance
=$87,300 U – $50,900 F
= $36,400 U
Explanation:brainlist pls
When a project involves an entirely new product line, the firm may be able to obtain betas from to calculate a weighted average cost of capital (WACC) for its new product line.
Consider the case of another company. Davis Printing is evaluating two mutually exclusive projects. They both require a $5 million investment today and have expected NPVs of $1,000,000. Management conducted a full risk analysis of these two projects, and the results are shown below.
Risk Measure Project A Project B
Standard deviation of project's expected NPVs $400,000 $200,000
Project beta 0.9 1.1
Correlation coefficient of project cash flows (relative to the firm's existing projects) 0.7 0.5
Which of the following statements about these projects' risk is correct? Check all that apply. ?
A. Project B has more corporate risk than Project A.
B. Project A has more corporate risk than Project B.
C. Project B has more stand-alone risk than Project A.
D. Project A has more market risk than Project B
Answer:
A. Project B has more corporate risk than Project A.
C. Project B has more stand alone risk than project A.
Explanation:
Project A and Project B are mutually exclusive projects. Both the projects require initial investment of $5 million. The project beta for Project A is 0.9 while project beta for Project B is 1.1, this indicates project B is more riskier than Project A.
Realizing that bacon toothpaste probably wasn’t the best invention, Mr. Bacon's business (Bacon Co.) developed a new product – bacon-scented sunscreen. Bacon Co. spent 6 months (January 2020 – Sept. 2020) and $10,000 developing the sunscreen. The product launched September 1, 2020, and initially it was a huge success. Bacon-scented sunscreen generated over $600,000 in sales in 2020. Sales tapered off quickly, and the sunscreen only generated sales of $100,000 in 2021. It is anticipated that there will be no bacon-scented sunscreen sales after 2021. What amount of R&E expenditures can Bacon Co. deduct in 2020 if Bacon Co. prefers to accelerate deductions as much as possible?
Helppppppp pleaseeee
Answer:
B
Explanation:
I think but i may be wrong
mcdonalds, burger king, pizza hut and KFc retaurastand all operate in different countries are best characterized as what kind of corporations
Answer:
multi-domestic corporation
Explanation:
A multi-domestic corporation are the localized form of multinational corporations. They operate through domestic channels. The management is headed by the domestic operations. The managers and operations are the local personnel who make the decisions and make significant changes in the respective countries. The management of McDonalds, Burger King, Pizza Hut and KFC comprises of the local team in every country. The decisions and regulations are termed in accordance to the culture, environment and market of the particular country.
Keidis Industries will pay a dividend of $4.35, $5.45, and $6.65 per share for each of the next three years, respectively. In four years, you believe that the company will be acquired for $61.00 per share. The return on similar stocks is 9.4 percent. What is the current stock price
Answer:
$56.19
Explanation:
Current stock price can be determined by calculating the present value of the dividend payments
Present value is the sum of discounted cash flows
Present value can be calculated using a financial calculator
Cash flow in year 1 = 4.35
Cash flow in year 2 = 5.45
Cash flow in year 3 = 6.65
Cash flow in year 4 = 61
I = 9.4
PV = $56.19
To find the PV using a financial calculator:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.
3. Press compute
The more the lower-level personnel provide input or are actually given the discretion to make decisions, the ________ within that organization.
The more the lower-level personnel provide input or are actually given the discretion to make decisions, the more [tex]\boxed{ decentralization }[/tex] there is within that organization.
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The more the lower-level personnel provide input or are actually given the discretion to make decisions, the Decentralization within that organization.
What do you mean by the decentralization?Decentralization is a type of organisational structure in which the top management delegated power to the middle and lower levels of management in an organisation.
Decentralization in management is the systematic distribution of power among the various levels of management within an organisation. It explains how different organizational levels are given different amounts of decision-making authority.
In a decentralized organisation, subordinates have the chance to demonstrate their skills. Through promotions, management also gains access to a pool of qualified workers who can be deployed in demanding situations and foster responsibility.
Therefore, the more the lower-level personnel provide input or are actually given the discretion to make decisions, the Decentralization within that organization.
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Sheffield Corp. had 205000 shares of common stock, 20300 shares of convertible preferred stock, and $1580000 of 4% convertible bonds outstanding during 2021. The preferred stock is convertible into 39800 shares of common stock. During 2021, Sheffield paid dividends of $1.00 per share on the common stock and $4 per share on the preferred stock. Each $1,000 bond is convertible into 30 shares of common stock. The net income for 2021 was $599000 and the income tax rate was 35%.
Diluted earnings per share for 2021 is :__________
Answer:
Diluted earnings per share for 2021 is: $2.19 per share.
Explanation:
Amount of increase in net income if bonds are converted = Total value of convertible bonds * Bond rate * (100% - Tax rate) = $1580000 * 4% * (100% - 35%) = $41,080
Total earnings available to Equity Shareholders = Net income + Amount of increase in net income if bonds are converted = $599000 + $41,080 = $640,080
Number of shares of common stock = 205,000
Number of common shares obtainable from preferred stock = 39,800
Number of common shares obtainable from convertible bonds = (Total value of convertible bonds / $1,000) * 30 = ($1580000 / $1,000) * 30 = 47,400
Total number of shares outstanding = Number of shares of common stock + Number of common shares obtainable from preferred stock + Number of common shares obtainable from convertible bonds = 205,000 + 39,800 + 47,400 = 292,200
Diluted earnings per share = Total earnings available to Equity Shareholders / Total number of shares outstanding = $640,080 / 292,200 = $2.19 per share
Therefore, we have:
Diluted earnings per share for 2021 is: $2.19 per share.
Gabi Gram started The Gram Co., a new business that began operations on May 1. The Gram Co. completed the following transactions during its first month of operations
May
1 G. Gram invested $40,000 cash in the company.
1 The company rented a furnished office and paid $2,200 cash for May’s rent.
3 The company purchased $1,890 of office equipment on credit.
5 The company paid $750 cash for this month’s cleaning services.
8 The company provided consulting services for a client and immediately collected $5,400 cash.
12 The company provided $2,500 of consulting services for a client on credit.
15 The company paid $750 cash for an assistant’s salary for the first half of this month.
20 The company received $2,500 cash payment for the services provided on May 12.
22 The company provided $3,200 of consulting services on credit.
25 The company received $3,200 cash payment for the services provided on May 22.
26 The company paid $1,890 cash for the office equipment purchased on May 3.
27 The company purchased $80 of advertising in this month’s (May) local paper on credit; cash payment is due June 1.
28 The company paid $750 cash for an assistant’s salary for the second half of this month.
30 The company paid $300 cash for this month’s telephone bill.
30 The company paid $280 cash for this month’s utilities.
31 G. Gram withdrew $1,400 cash from the company for personal use.
Required
a. Show effects of the transactions on the accounts of the accounting equation by recording increases and decreases in the appropriate columns.
b. Prepare an income statement for May, a statement of owner’s equity for May, a May 31 balance sheet, and a statement of cash flows for May.
Answer:
1. Asset and capital will increase
2. Current asset decrease
3. Asset and liability increase
4. Asset decrease
5. Asset increase
6. Asset increase
7. Asset decrease, expense increase
8. Asset increase
9. Asset increase
10. Asset decrease, liability decrease
11. Liability increased
12. Asset decrease
13. Asset decrease
14. Capital decrease
Explanation:
Income Statement for the month of May:
Sales Revenue $11,100
Less: Operating Expenses:
Cleaning service $750
Salary expense $750
Advertising expense $80
Salaries expense $750
Telephone bill $300
Utilities expense $280
Net Profit $8,190
Legal Forces Legal forces are important external forces that international managers need to understand. They are developed at the national level, so international ventures should take care to build relationships with local-level lawyers.
The concepts in this exercise are drawn from Chapter 6 and directly address differences in legal approaches at the national level.
Identify each of the legal characteristics by dragging where it is found to the correct characteristic.
U.S. Product Liability Law per se application
EU Competition Law misuse of activity
US and EU extraterritoriality
U.S. Tort Law trade obstacle, nontariff
U.S. Competition Law strict liability
France punitive damages
Answer:
Please find the solution in the attached file.
Explanation:
For each of the following sentences, select the phrase or group of words that best completes the statement. Earnings per share Dividend yield ratio Dividend payout ratio Return on assets ratio Return on common stockholders' equity ratio
Answer:
Note See complete and organized question as attached as picture below
1. Dividend yield ratio
Correct phrase: Relationship between dividends and the market price of a company's stock.
2. Dividend payout ratio
Correct phrase: Percentage of earnings paid out as dividends.
3. Return on assets ratio
Correct phrase: Measure of a company's success in earning a return for all the providers of the capital.
4. Return on common stockholders' equity ratio
Correct phrase: Measure of a company's success in earning a return for the common stockholders.
In assembly-line balancing, cycle time (the ratio of available production time to scheduled production) is the: minimum time that a product is allowed at each workstation. maximum time that a product is allowed at each workstation. inverse of the minimum number of workstations needed. sum of all the task times divided by the maximum number of workstations. equivalent of the maximum task time among all tasks.
Answer:
maximum time that a product is allowed at each workstation
Explanation:
The cycle time represent the maximum time for each and every workstation
Also,
Theoretical number of workstation = Total task time ÷ Cycle time
The cycle time is the vital concept with regard to the line balancing to give assurance related to the production happen according to the demand. Also it help in allocation of the resources in the proper way.
Therefore the above statement should be considered
Martha B's has total assets of $1,810. These assets are expected to increase in value to either $1,900 or $2,400 by next year. The company has a pure discount bond outstanding with a face value of $2,000. This bond matures in one year. Currently, U.S. Treasury bills are yielding 5.5 percent. What is the value of the equity in this firm
Answer:
$7.24
Explanation:
PV at the risk free rate = $1,900 / (1 + 0.055)
PV at the risk free rate = $1,900 / 1.055
PV at the risk free rate = $1,800.95
Number of options needed = (2,400 - 1,900) / (400 - 0)
Number of options needed = 500 / 400
Number of options needed = 1.25
Total assets = (No of options needed*Value of equity) + Present value at the risk free rate. Let Value of equity be C0
$1,810 = (1.25*C0) + $1,800.95
$1,810 - $1,800.95 = 1.25*C0
C0 = $9.05 / 1.25
C0 = $7.24
So, the Value of equity in this firm is $7.24.
Identifying your sources will help you to establish credibility.
Question 6 options:
True
False
Answer:
True
Explanation:
Identifying your sources help your audience believe that your information is reliable.
The statement is True. Identifying your sources will help you to establish credibility.
You can increase your trustworthiness by: Being competent is being knowledgeable in your chosen subject. Giving accurate, verified facts is being honest. Responsibility for your choices and deeds.
Why is it important to establish credibility?
Credibility is a crucial quality since it has the power to change people's habits, attitudes, and behaviors. Therefore, if a business, its representatives, or its brand lack credibility, others will be less inclined to trust what is being said or taught, making communication pointless.
You must be regarded as a reliable source of information and judgment by your team members if you want to build credibility. However, when it comes to establishing credibility, deeds speak louder than words. For instance, you risk losing people's confidence if you don't keep your word or make poor decisions without a clear plan.
Thus, Three factors trustworthiness, expertise, and dynamism were taken into consideration while evaluating the people we were working with when only considering their credibility.
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A company that is at a disadvantage in the marketplace because it lacks competitively valuable resources possessed by rivals:_________
a) nearly always is relegated to a trailing position in the industry.
b) should adopt a new competitive strategy that might better match the circumstances of the marketplace.
c) should abandon strategy elements that have caused its weakness in the marketplace.
Answer:
a) nearly always is relegated to a trailing position in the industry.
Explanation:
Competitive advantage is defined as factors that a business possesses that allows it to produce goods and services that are better or satisfy customers more than those produced by other competitors.
Competitive advantage results in increased sales and higher profit margins.
This can be broken down into:
- Comparative advantage: where a business produces a good more efficiently than its competitors
- Differential advantage: when a good produced is of higher quality or more unique that other competitor products.
When a company lacks competitively valuable resources possessed by rivals, it will nearly always is relegated to a trailing position in the industry. Because they can't meet up to profit margins of others.
Assume the inflation rate is 0.2% per month. Would you rather earn a nominal return of 0.75% per month compounded monthly, or a real return of 6.5% APR compounded annually? The annual rate for the nominal return of 0.75% per month is:___.
Answer:
6.79%
Explanation:
Use the following formula to calculate the Effective annual rate
Effective annual rate = ( ( ( 1 + Nominal return )^12 ) / ( ( 1 + Inflation return )^12 ) - 1 )
Where
Nominal rate = 0.75%
Inflation rate = 0.20%
Placing values in the formula
Effective annual rate = ( ( ( 1 + 0.75% )^12 ) / ( ( 1 + 0.2% )^12 ) - 1 )
Effective annual rate = 6.79%
82% of companies shop their products by truck. 47% of companies ship their product by rail 40% of companies shop by truck and rail. What is the probability that a company shops by truck or rail
Answer: 0.89
Explanation: add the 82% and 47% then subtract the 40, answer is 89.
82% of companies shop their products by truck. 47% of companies ship their product by rail, 40% of companies shop by truck and rail. The probability that a company shops by truck or rail is 0.89.
What is company?The term "company" refers to legal entities that are lawfully registered under the Company Act. The company's major goal is to increase profits while maintaining goodwill. With the assistance of management, the organization was flawlessly run. Employees are compensated by the company.
Determine the probability of that a company shops by truck or rail:
As the given amount are:
82% of companies shop their products by truck.
47% of companies ship their product by rail
40% of companies shop by truck and rail.
The company shops by truck = ?
The company shops by truck = products by truck + product by rail – shop by truck and rail.
The company shops by truck = 0.82 + 0.47 – 0.40
The company shops by truck = 1.29 – 0.40
The company shops by truck = 0.89
As a result, the probability that a company shops by truck or rail is 0.89.
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Workman Software has 11 percent coupon bonds on the market with 19 years to maturity. The bonds make semiannual payments and currently sell for 108.3 percent of par. a. What is the current yield on the bonds
Answer:
10.16%
Explanation:
Coupon amount = 11% * 1000
Coupon amount = $110
Price of bond = 1000*108.3%
Price of bond = $1,083
Current yield = Coupon amount / Price of bond
Current yield = $110 / $1,083
Current yield = 0.1015697
Current yield = 10.16%
So, the current yield on the bonds is 10.16%.
You own a portfolio that has $2,600 invested in Stock A and $3,600 invested in Stock B. If the expected returns on these stocks are 12 percent and 15 percent, respectively, what is the expected return on the portfolio
Answer:
the expected return on the portfolio is $7,052
Explanation:
The computation of the expected return on the portfolio is shown below:
Stock A return = $2,600 + 12% of 2600 = $2,912
And,
Stock B return = $3,600 + 15% of 3600 = $4,140
So,
Expected return on portfolio is
= $2,912 + $4,140
= $7,052
hence, the expected return on the portfolio is $7,052
Options for attacking the high costs of items purchased from suppliers do not include Multiple Choice pressuring suppliers for more favorable prices. integrating backward into the business of high-cost suppliers and making the item in-house so as to better control the cost. switching to lower-priced substitute inputs. collaborating closely with suppliers to identify mutual cost-saving opportunities. raising prices to customers (in order to cover the high costs).
Answer:
raising prices to customers (in order to cover the high costs).
Explanation:
Supply-side economist can be defined as economists who believes that the ability and willingness of the producers of goods and services to manufacture or produce sets the pace for the economic growth of a country.
This ultimately implies that, increasing the supply of goods and services would cause an economic growth for a country.
Options for attacking or mitigating the high costs of items purchased from suppliers do not include, the seller such as a retailer raising prices to customers in a bid to cover the high costs incurred from the supply.
However, the seller could pressure his or her supplier to lower the cost, switch to a cheaper substitute products, and creating a collaborative effort with the supplier for mutual cost-saving opportunities in the market.
Weekly demand figures at Hot Pizza are as follows:
Week Demand($)
1 108
2 116
3 118
4 124
5 96
6 119
7 96
8 102
9 112
10 102
11 92
12 91
Using the Hot Pizza weekly demand figures provided, estimate demand for Week 4 to Week 12 by using a 3-week moving average as well as simple exponential smoothing with α = 0.2. Evaluate the MAD, MAPE, MSE, bias, and TS in each case. Which of the two methods do you prefer? Why? Include all calculations as well as your narrative explanation and summary.
Answer:
MAD: 10.04, 11.53
MAPSE: 10% , 12%
MSE : 146.33, 178.72
Bias : -0.56 , -0.96
3-week moving average method is better
Explanation:
i ) Evaluate MAD ( average of absolute errors )
using 3 week moving average
= 10.04
using simple exponential smoothing
= 11.53
ii) MAPSE ( average of absolute percentage error )
using 3 week moving average
= 10%
using simple exponential smoothing
= 12%
iii) MSE ( average of Squared Errors )
3 week MV = 146.33 , Simple exponential smoothing = 178.72.
iv) Bias
3 week MV = -5/9 = -0.56, Simple exponential smoothing = -8.69/9 = -0.96.
v) TS ( Total error / MAD )
3 week MV = -5 / 10.04 = -0.49 ,
simple exponential smoothing = -8.69 / 11.53 = -0.75
b) I prefer 3-week moving average based on the values of MAD , MAPE, MSE, bias and TS which shows that there is a better estimate when using the 3 -weeks moving average.
Attached below is the Tabular calculations of the required parameters for the question
Stock A's stock has a beta of 1.30, and its required return is 11.75%. Stock B's beta is 0.80. If the risk-free rate is 4.75%, what is the required rate of return on B's stock?
Answer:
9.054
Explanation:
The first step is to calculate the market risk premium for stock A
11.75%= 4.75% + 1.30 × market risk premium
11.75-4.75= 1.30×mrp
7= 1.30 ×mrp
mrp= 7/1.30
= 5.38
Therefore the required rate on stock B can be calculated as follows
4.75+0.80×5.38
= 4.75 + 4.304
= 9.054
You have just signed a contract for your rental property and you will make monthly payments at the beginning of each month. Your monthly payments is $1000 and the monthly rate is 4% per month. Calculate the present value of your rental payments for the first year.
Answer:
$9,760.48
Explanation:
Present value of annuity due = P* [[1 - (1+r)^-(n-1)] / r] + P. Where P = Periodic payment = $1,000, r = Rate of interest per period 4% (0.48/12), n = number of payments 12 (12*1)
Present value of annuity = $1000 * [[1 - (1 + 0.04)^-(12-1)] / 0.04] + $1000
Present value of annuity = $1000*8.760475 + $1000
Present value of annuity = $8760.48 + $1000
Present value of annuity = $9,760.48
Garida Co. is considering an investment that will have the following sales, variable costs, and fixed operating costs:
Year 1 Year 2 Year 3 Year 4
Unit sales 4,200 4,100 4,300 4,400
Sales price $29.82 $30.00 $30.31 $33.19
Variable cost per unit $12.15 $13.45 $14.02 $14.55
Fixed operating costs $41,000 $41,670 $41,890 $40,100
This project will require an investment of $10,000 in new equipment. Under the new tax law, the equipment is eligible for 100% bonus deprecation at t = 0, so it will be fully depreciated at the time of purchase. The equipment will have no salvage value at the end of the project’s four-year life. Garida pays a constant tax rate of 25%, and it has a weighted average cost of capital (WACC) of 11%. Determine what the project’s net present value (NPV) would be under the new tax law.
Determine what the project’s net present value (NPV) would be under the new tax law.
a) $80,438
b) $67,032
c) $77,087
d) $60,329
Answer:
Garida Co.
The project's net present value (NPV) is:
= $57,787
Explanation:
a) Data and Calculations:
Year 1 Year 2 Year 3 Year 4
Unit sales 4,200 4,100 4,300 4,400
Sales price $29.82 $30.00 $30.31 $33.19
Variable cost per unit $12.15 $13.45 $14.02 $14.55
Fixed operating costs $41,000 $41,670 $41,890 $40,100
Year 1 Year 2 Year 3 Year 4
Sales Revenue $125,244 $123,000 $130,333 $146,036
Variable costs $51,030 $55,145 $60,286 $64,020
Fixed operating costs $41,000 $41,670 $41,890 $40,100
Total costs $92,030 $96,815 $102,176 $104,120
Income before tax $23,214 $26,185 $28,157 $41,916
Income tax (25%) 5,804 6,546 7,039 10,479
Net income/cash inflow $17,410 $19,639 $21,118 $31,437
PV factor 0.901 0.812 0.731 0.659
Present value $15,686 $15,947 $15,437 $20,717
Total present value of the cash inflows = $67,787
Less investment cost of equipment = 10,000
Project's net present value (NPV) = $57,787
How are laws of supply and demand similar
A company issues a 10-year, callable bond at par with 8% annual coupon payments. The bond can be called at par in one year after issue or any time after that on a coupon payment date. The call price is $108 per $100 of face value. What is the yield to call if this bond is called in one year
Answer:
the yield to call is 9%
Explanation:
The computation of the yield to call is as follows:
Given that
NPER is 10 year
PMT = $100 × 8% = $8
FV = $108
PV = $100
The formula is shown below:
= RATE(NPER,PMT,PV,FV,TYPE)
after applying the above formula, the yield to call is 9%
A minor league baseball team raised the average price of its tickets from $8 to $ and found that average attendance at its games dropped from 5,200 to . Using the arc elasticity of demand formula, the price elasticity of demand for tickets is nothing. (Express your answer as a real number rounded to two decimal places. Don't forget the negative sign.) The demand for tickets is therefore ▼ price elastic price inelastic unit elastic completely elastic completely inelastic .
Answer:
-0.95
inelastic
Explanation:
minor league baseball team raised the average price of its tickets from $8 to $8.90 and found that average attendance at its games dropped from 5, 200 to 4, 700. Using the arc elasticity of demand formula, the price elasticity of demand for tickets is .(Express your answer as a real number rounded to two decimal places. Don't forget the negative sign.) The demand for tickets is therefore
Price elasticity of demand measures the responsiveness of quantity demanded to changes in price of the good.
Price elasticity of demand = midpoint change in quantity demanded / midpoint change in price
Midpoint change in quantity demanded = change in quantity demanded / average of both demands
change in quantity demanded = 4700- 5200= -500
average of both demands = (4700 + 5200 ) / 2 = 4950
Midpoint change in quantity demanded = 500 / 4950 = -0.101
midpoint change in price = change in price / average of both price
change in price = 8.9 - 8 = 0.9
average of both price = (8.9 + 8) / 2= 8.45
0.9 / 8.45 = 0.107
-0.101 / 0.107 = -0.95
If the absolute value of price elasticity is greater than one, it means demand is elastic. Elastic demand means that quantity demanded is sensitive to price changes.
Demand is inelastic if a small change in price has little or no effect on quantity demanded. The absolute value of elasticity would be less than one
Demand is unit elastic if a small change in price has an equal and proportionate effect on quantity demanded.
Infinitely elastic demand is perfectly elastic demand. Demand falls to zero when price increases
Perfectly inelastic demand is demand where there is no change in the quantity demanded regardless of changes in price.
0.1125
-0.1754
After Jim has gotten two different quotes for repairing his brakes, one from the dealership and one from a small, private mechanic, he choses to go with the small mechanic who has agreed to do his brakes for $200.00 less than the dealership. Jim takes his car to the mechanic who begins working on his brakes. After a week passes, the mechanic calls him and tells him he is in over his head and cannot fix his brakes. Jim goes over to pick up his car and finds his car in the mechanic's garage with the brakes disassembled around the mechanic's garage. What legal recourse does Jim have?
Answer:
Primary estoppel
Explanation:
Primary estoppel is defined as the principle that a promise made by a promisor is enforceable most especially when a promisee believes the promise and this leads to a subsequent detriment.
In the given scenario Jim used a small mechanic to repair his brakes and was assured he could do the job.
However the mechanic calls him and tells him he is in over his head and cannot fix his brakes, and finds his car in the mechanic's garage with the brakes disassembled around the mechanic's garage.
He can resort to primary estoppel as a legal recourse.
ABC Company operates two divisions with the following operating information for the month of May:
Division 1: sales, $128,000; operating income, $39,680; operating assets, $320,000.
Division 2: sales, $84,000; operating income, $42,336; operating assets, $420,000.
ABC Company expects a minimum return of 10% should be earned from all investments.
Required:
Prepare ABC Company’s ROI analysis using the DuPont model for each division.