Answer:
Market value of the stocks $
Market value of common stocks (3 shares x $40) 120
Market value of preferred stock ( 1 share x $100) 100
Total market value of the stocks 220
Total value of 50 packages of securities
= 50 x $154
= $7,700
The total value of preferred stocks
= $100/$220 x $7,700
= $3,500
The correct answer is A
Explanation:
There is need to calculate the market value of the two stocks by multiplying the units of each stock by their respective current market price. Then, we will determine the total value of the 50 packages of securities, Finally, we will determine the total value to be assigned to preferred stock, which is the market value of preferred stock divided by the total market value multiplied by the total value of 50 packages of securities.
Three examples of oligopolies in the United States are industries that produce or sell A. DVDs, college textbooks, and breakfast cereal. B. automobiles, athletic footware, and cigarettes. C. first minus class mail delivery, dog and cat food, and pharmaceutical drugs. D. groceries in supermarkets, toys, and aircraft. E. apples, pharmaceutical drugs, and beer.
Answer: Option B
Explanation: In simple words, oligopoly refers to a market structure in which there are small number of firms, each operating at a high level, that dominate the whole industry.
Generally these firms are dependent on each other and compete on the basis of other factors than price. The products sold by the firms in these industries are not perfect substitute of each other and possess some minor differences.
The entry and exit in these industries is quite difficult due to high rules and regulations and heavy investments.Thus, from the above we can conclude that the correct option is B.
Oligopolies are markets dominated by a few large firms. Such markets in the U.S. include the automobile, athletic footwear, and cigarette industries, where companies such as General Motors, Ford, Nike, Adidas, Philip Morris and Reynolds American hold the majority of market share.
Explanation:Oligopolies are market structures characterized by a small number of large firms holding the majority of market share. These markets sit somewhere between perfect competition and monopolies, with companies mutually interdependent on each others decisions regarding output, prices, and advertising. Their behaviour may fluctuate between acting like perfect competitors, driving costs down, or acting like a monopoly, if they collude and drive prices up.
Three examples of oligopolies in the United States are the industries that produce or sell automobiles, athletic footware, and cigarettes (Option B). The automobile industry, for instance, is dominated by a small number of large corporations, like General Motors, Ford, and Chrysler. Similarly, the athletic footwear market is largely controlled by firms like Nike and Adidas. The cigarette industry is another example, with major firms like Philip Morris and Reynolds American controlling a great part of the market.
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1. The loanable fund model tells us that, other things being equal, capital will tend to flow from countries with __ to countries with __.
2. International differences in the demand for domestic loanable funds are primarily due to variations in __, while differences in the supply of funds generally reflect differences in __
Answer:
1) The loanable fund model tells us that, other things being equal, capital will tend to flow from countries with low interest rates to countries with high interest rates.
2) International differences in the demand for domestic loanable funds are primarily due to variations in investment opportunities , while differences in the supply of funds generally reflect differences in savings rate.
Explanation:
1) According to the loanable funds model people living in countries with low interest rate will move their money to other countries which have higher interest rates in order to earn a higher interest rate on their money. This is also known as hot money flow. For example If I live in UK has an interest rate of 4% and Germany has an interest rate of 8%, I will move my money to Germany to earn extra interest on my money. This is an example of money flowing from a country with low interest rate to a country with high interest rate.
2) There will be higher demand for loanable funds if there are more investment opportunities because people will borrow money to invest in other ventures in order to make more money than the interest they are paying, if the investment opportunities are low then the demand for loanable funds will also be low as people would not want to borrow money. And the supply of loanable funds is the money that people save in banks, so the higher the savings rate the higher the supply of loanable funds will be.
The loanable fund implies that, other things being equal, capital will tend to flow from countries with low interest rates to countries with high interest rates.
What are loanable funds model?
International differences in the demand for domestic loanable funds are primarily due to variations in investment opportunities, while differences in the supply of funds generally reflect differences in savings rate.
The loanable funds model is known to be a kind of a model that often uses supply and demand to show or depict how an interest rate is set by the interaction that exist between savers who are said to supply money and investors who ware known to borrow money.
The loanable funds model for a closed economy is known to be in equilibrium and the supply of loanable funds curve often intersects the demand for loanable funds curve.
Conclusively, International differences in the aspect of demand for domestic loanable funds are known to be as a result of some differences in investment that are made available.
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ABC Steel Co. is considering buying a new machine in order to increase its production capacity using new technology. Details about the new equipment are below: Purchase Cost $300,000 Savings offered by the new machine $62,500 per year Life of the new machine 15 years The corporate policy of ABC Steel Co. is to reject all proposal with a payback period of more than 7 years. Therefore, would ABC buy the new machine?
a. 7.2 years
b. 6.8 years
c. 4.8 years
d. 12.4 years
Answer:
payback period is lesser than 15 years we can say that they should buy the machine
so correct option is c. 4.8 years
Explanation:
given data
Purchase Cost = $300,000
Savings offered = $62,500 per year
Life of machine = 15 years
to find out
Payback period
solution
first we get here Payback period that is express as
Payback period = purchase cost ÷ savings ...........1
put here value we get
Payback period = [tex]\frac{300000}{62500}[/tex]
Payback period = 4.8 years
and here payback period is lesser than 15 years we can say that they should buy the machine
so correct option is c. 4.8 years
ABC Steel Co. would purchase the new machine since the payback period of 4.8 years is less than the company's maximum acceptable period of 7 years.
Explanation:The question asks whether ABC Steel Co. would purchase a new machine based on its payback period policy. To determine the payback period, we need to divide the initial purchase cost of the equipment by the annual savings it offers. In this case, the purchase cost is $300,000 and the savings are $62,500 per year. To calculate the payback period: $300,000 / $62,500 per year = 4.8 years. Comparing this result with the company policy, which rejects proposals with a payback period of more than 7 years, the new machine has a payback period that is well within the acceptable range. Therefore, ABC Steel Co. would likely approve the purchase of the new machine.
Which of the following taxes does not represent a common payroll deduction?
a. Federal income taxes.
b. FICA taxes.
c. State unemployment taxes.
d. State income taxes.
Answer: C - State unemployment taxes
Explanation: State unemployment taxes are payroll taxes paid by employers of labour to the state unemployment fund.
It is paid on behalf of their employees to the state and it is used by the State Government to support unemployed citizens.
The rate of State Unemployment tax is not fixed, the rate is decided by each state and can be changed annually.
Several years ago, Kurt paid $15,000 for 1,000 shares of stock in ABC. During the current year ABC declares a three-for-one stock split. Shortly thereafter, Kurt sells 1,000 shares of ABC stock for $12,000. His recognized gain on the sale of the 1,000 shares is:A. $7,000.B. $2,000.C. $0.D. $12,000.E. $5,000.
Answer:
A. $7,000
Explanation:
Kurt paid $15,000 for 1,000 shares.
As ABC company declares 3-for-1 stock split, the new number of shares = 1,000 × 3 = 3,000 shares.
New purchase price of each share = $15,000 ÷ 3,000 = $5.
1,000 shares price = 1,000 × 5 = $5,000.
Kurt sells 1,000 shares for $12,000.
Therefore, recognized gain = $(12,000 - 5,000) = $7,000.
However, because of stock split, Kurt gets high profit including an unrecognized profit too.
A company's Inventory balance at the end of the year was $204,200 and $218,000 at the beginning of the year. Its Accounts Payable balance at the end of the year was $102,000 and $96,200 at the beginning of the year, and its cost of goods sold for the year was $738,000. The company's total amount of cash payments for merchandise during the year equals:
a $738,000.
b $746,000.
c $757,600.
d $718,400.
Answer:
b $746,000
Explanation:
the amount purchased in year = cost of good sold + Inventory at beginning - Inventory at end = $738,000 + $218,000 - $204,200 = $751,800
The cash payments for merchandise during the year = Account Payable (AP) at beginning - AP at end + Amount purchased in year = $96,200 - $102,000 + $751,800 = $746,000
CU, Incorporated (CUI) produces copper contacts that it uses in switches and relays. CUI needs to determine the order quantity, Q, to meet the annual demand at the lowest cost. The price of copper depends on the quantity ordered. Here are price-break and other data for the problem:
Price of copper $ 0.82 per pound up to 2,499 pounds
$ 0.81 per pound for orders between 2,500 and 5,000 pounds
$ 0.80 per pound for orders greater than 5,000 pounds
Annual demand 50,000 pounds per year
Holding cost 20 percent per unit per year of the price of the copper
Ordering cost $ 30
Which quantity should be ordered?
Answer:
If CUI buys at $0.82 per pound
Annual demand (Co) = 50,000 pounds
Ordering cost per order (Co) = $30
Holding cost per item per annum (H) = 20% x $0.82 = $0.164
EOQ = √2DCo
H
EOQ = √2 x 50,000 x $30
$0.164
EOQ = 4,277 units
The solution is not feasible since 4,277 units could not be bought at $0.82 per pound.
If CUI buys at $0.81 per pound
Annual demand (Co) = 50,000 pounds
Ordering cost per order (Co) = $30
Holding cost per item per annum (H) = 20% x $0.81 = $0.162
EOQ = √2DCo
H
EOQ = √2 x 50,000 x $30
$0.162
EOQ = 4,303 units
Total cost for 4,303 units
= DCo + QH + P x D
Q 2
= 50,000 x $30 + 4,303 x $0.162 + $0.81 x 50,000
4,303 2
= $348.59 + $348.54 + $40,500
= $41,197.13
If CUI buys at $0.80 per pound
Annual demand (Co) = 50,000 pounds
Ordering cost per order (Co) = $30
Holding cost per item per annum (H) = 20% x $0.80 = $0.16
EOQ = √2DCo
H
EOQ = √2 x 50,000 x $30
$0.16
EOQ = 4,330 units
The solution is not feasible since 4,330 units could not be bought at $0.80 per pound. Thus, EOQ is 5,001 units.
Total cost for 5,001 units
= DCo + QH + P x D
Q 2
= 50,000 x $30 + 5,001 x $0.16 + $0.80 x 50,000
5,001 2
= $299.94 + $400.08 + $40,000
= $40,700.02
Thus, EOQ equals 5,001 units because the quantity minimises the total cost.
Explanation:
EOQ is a function of square root of 2 multiplied by annual demand and ordering cost per order divided by holding cost per item per annum.
Since this question involves discounts, there is need to calculate EOQ at various discount levels. Holding cost is a function of price. For instance, when price is $0.82, holding cost is 20% of $0.82.
We will calculate the EOQ at various prices and corresponding total cost. Finally, we will consider the quantity that minimizes the total cost. Thus, EOQ equals 5,001 units.
Given the price breaks and costs, it is most cost-effective for CU, Incorporated to order more than 5,000 pounds of copper in order to get the price of $0.80 per pound, according to the Economic Order Quantity (EOQ) model.
Explanation:To answer the question, we first need to understand the concept of Economic Order Quantity (EOQ). EOQ is a model that identifies the optimal order quantity a company can purchase to minimize its inventory costs by calculating the total minimum cost. These costs include ordering costs, holding cost, and the cost of not having inventory when needed.
Given the price breaks in the question, we need to understand that EOQ calculation will give us the starting point to determine which price tier to use. Assuming that the cost of the ordering and the holding costs is the same across all price breaks, it would be more cost-effective to purchase at the lower cost per unit. Therefore, to meet the annual demand at the lowest cost, CUI should order more than 5,000 pounds to get the best price of $0.80 per pound.
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Assume that the current price of a market basket of goods is $2,500 and the base year price of the same market basket is $2,000. The current price index is
A. 2500.
B. 125.
C. 200.
D. 250.
Answer:
The correct answer is B.
Explanation:
Giving the following information:
The current price of a market basket of goods is $2,500 and the base year price of the same market basket is $2,000.
To calculate the price index we need to make a simple division:
Price index= P1/P0
PI= 2,500/2,000= 1.25*100= 125%
The current price index, calculated using the formula (Current Cost / Base Period Cost) × 100, with given values equates to 125, making the right choice B. 125.
The question involves calculating the current price index given the current and base year prices of a market basket of goods. The formula to compute the price index is (Current Cost of the Market Basket / Base Period Cost of the Market Basket) × 100. Using the provided numbers, the calculation is (\(\frac{2500}{2000}\) × 100), which equals 125. Therefore, the correct answer is B. 125.
It has been observed that whenever one imported beer distributor raises its price, other imported beer distributors quickly raise their price as well. Such behavior is characteristic of:
(A) price leadership.
(B) the kinked-demand curve model of oligopoly.
(C) the barometric-firm model of price leadership.
(D) explicit collusion.
On January 1, Year 1, Weller Company issued bonds with a $260,000 face value, a stated rate of interest of 10.00%, and a 10-year term to maturity. Weller uses the effective interest method to amortize bond discounts and premiums. The market rate of interest on the date of issuance was 8.00%. Interest is paid annually on December 31. Assuming Weller issued the bond for $280,640, what is the amount of interest expense that will be recognized during Year 3
Answer: I would attend to this question tomorrow. Hang on.
Explanation:
Plainville Corporation has the following data, in thousands. Assuming a 365-day year, what is the firm's cash conversion cycle? Annual sales = $600,000 Annual cost of goods sold = $360,000 Inventory = $75,000 Accounts receivable = $160,000 Accounts payable = $25,000
a. 120.6 days
b. 126.9 days
c. 133.6 days
d. 140.6 days
e. 148.0 days
Answer:
Inventory cycle = Inventory x 365 days
Cost of goods sold
Inventory cycle = $75,000 x 365 days
$360,000
= 76.04 days
Receivable days = Accounts receivable x 365 days
Sales
= $160,000 x 365 days
$600,000
= 97.33 days
Payable days = Accounts payable x 365 days
Cost of sales
= $25,000 x 365 days
$360,000
= 25.35 days
Cash conversion cycle
= Inventory cycle + Receivable days - Payable days
= 76.04 days + 97.33 days - 25.35 days
= 148.0 days
Explanation:
Cash conversion cycle is calculated as raw inventory cycle plus receivable days minus payable days. Inventory cycle is the ratio of inventory to cost of goods sold multiplied by number of days in a year. Receivable days refer to the ratio of accounts receivable to sales multiplied by number of days in a year. Payable day is the ratio of accounts payable to cost of goods sold multiplied by number of days in a year.
The gross profit method of inventory valuation is not valid when a. there is substantial increase in the quantity of inventory during the year. b. there is substantial increase in the cost of inventory during the year. c. the gross margin percentage changes significantly during the year. d. all ending inventory is destroyed by fire before it can be counted.
Answer:
The gross profit method of inventory valuation is not valid when
c. the gross margin percentage changes significantly during the year.
Explanation:
Gross Profit Method:
It is such method that is used to determine the value of ending inventory in a specific period.
The option a, b and d are valid as this method is used when there is substantial increase in the quantity of inventory or in the cost of the inventory during the year. Moreover, it is also used to calculate the amount of ending inventory that is effected by a disaster such as fire, theft etc.The option c is not valid because it is not used when the gross margin percentage changes significantly during the year as gross profit method is only used to determine the amount of an ending inventory.The gross profit method of inventory valuation is not valid in certain scenarios such as substantial increases in quantity or cost of inventory, significant changes in gross margin percentage, or when all ending inventory is destroyed by fire.
Explanation:The gross profit method of inventory valuation is not valid when there is a substantial increase in the quantity of inventory during the year, a substantial increase in the cost of inventory during the year, or when the gross margin percentage changes significantly during the year. It is also not valid when all ending inventory is destroyed by fire before it can be counted.
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Organic food is grown without synthetic pesticides, chemical fertilizers or genetically modified seeds.Why is organic foods more expensive than their conventional counterparts? Describe what factors have affected and will continue to affect the demand and supply for organic foods? Describe any shifts, and make any predictions of what might happen to the prices of organic foods in the future
Explanation:
Organic foods are more expensive than conventional ones mainly by the law of supply and demand, as supply is lower than demand, the price is consequently more expensive than non-organic foods.
This is because there are few organic farms in the world due to the high cost of certifying and maintaining the environmentally and socially responsible standards required as a model on organic farms. There are also the longest factors of organic production, which are produced without pesticides and chemical fertilizers, so they grow slower and in smaller quantities.
The global trend of organic consumption tends to increase, organic consumption is already up, but due to the high price not all consumers can buy. What happens is that the consumer has the ability to change consumer relations, as interest arises and demands for such products increase, companies will be forced to change the way they produce organic food, which means it tends to popularize production, consumption more and lower price.
The overall learning goals for an educational program like the one you’re taking are called _______.
A. grades
B. objectives
C. credits
D. lessons
Village Corp., a calendar year corporation, began business in year 1. Village made a valid S corporation election on December 5, year 4, with the unanimous consent of its shareholders. The eligibility requirements for S status continued to be met throughout year 5. On what date did Village's S status become effective?
a. January 1, year 4
b. January 1, year 5
c. December 5, year 4
d. December 5, year 5
Answer:
The correct answer is letter "B": January 1, year 5.
Explanation:
The S corporation election must be made by the 15th day of the third month of the taxable year to be valid for the current taxable year. If the election is made after that date, it will take effect on the first year of the next taxable year. Since Village Corp. changed into S corporation on December 5th, year 4, Village's S status will begin on January 1st, year 5.
Julie transferred a building with an adjusted basis of $240,000 for another building with a fair market value of $350,000 and $25,000 in cash.
Answer:
New Building. $ 350,000 (debit)
Cash. $ 25,000 (debit)
Old Building. $ 115,000 (credit)
Profit & Loss Account $ 240,000 (credit)
Explanation:
The adjustment was made for $240,000 to P&L account and the old building was exchanged with new building if $350,000 with cash $25,000.
This is the required entry to be made.
New Building. $ 350,000 (debit)
Cash. $ 25,000 (debit)
Old Building. $ 115,000 (credit)
Profit & Loss Account $ 240,000 (credit)
On January 1, 2021, the Mason Manufacturing Company began construction of a building to be used as its office headquarters. The building was completed on September 30, 2022. Expenditures on the project were as follows:
January 1, 2021 $ 1,940,000
March 1, 2021 1,680,000
June 30, 2021 1,880,000
October 1, 2021 1,680,000
January 31, 2022 432,000
April 30, 2022 765,000
August 31, 2022 1,062,000
On January 1, 2021, the company obtained a $4,800,000 construction loan with a 14% interest rate. The loan was outstanding all of 2021 and 2022. The company’s other interest-bearing debt included two long-term notes of $3,000,000 and $7,000,000 with interest rates of 6% and 10%, respectively. Both notes were outstanding during all of 2021 and 2022. Interest is paid annually on all debt. The company’s fiscal year-end is December 31.
Required:
1. Calculate the amount of interest that Mason should capitalize in 2021 and 2022 using the specific interest method.
2. What is the total cost of the building?
3. Calculate the amount of interest expense that will appear in the 2021 and 2022 income statements.
Answer
The answer and procedures of the exercise are attached in the following archives.
Step-by-step explanation:
You will find the procedures, formulas or necessary explanations in the archive attached below. If you have any question ask and I will aclare your doubts kindly.
1. The amount of interest that Mason should capitalize in 2021 and 2022 using the specific interest method is $1,552,000 and $1,259,000, respectively.
2. The total cost of the building is $12,250,000.
3. The amount of interest that will appear in the 2021 and 2022 income statements is $0, respectively.
How is the specific interest method different from the weighted average method?The difference is that the specific interest method capitalizes the interest on each individual loan and the weighted average method combines all the debt and averages the interest payments on each loan to determine a weighted average interest rate.
Data and Calculations:Specific Loans:
January 1, 2021 Construction Loan = $4,800,000
Interest rate of construciton loan = 14%
Interest for the construction loan = $672,000 ($4,800,000 x 14%)
Interests on the Long-term Notes Payable:
$3,000,000 at 6% = $180,000 ($3,000,000 x 6%)
$7,000,000 at 10% = $700,000 ($7,000,000 x 10%)
Total interest expense for 2021 = $1,552,000 ($672,000 + $180,000 + $700,000)
Interests on the Long-term Notes Payable:
$3,000,000 at 6% = $120,000 ($3,000,000 x 6% x 8/12)
$7,000,000 at 10% = $467,000 ($7,000,000 x 10% x 8/12)
Total interest expense for 2022 = $1,259,000 ($672,000 + $120,000 + $467,000)
Total Costs of Building:January 1, 2021 $ 1,940,000
March 1, 2021 1,680,000
June 30, 2021 1,880,000
October 1, 2021 1,680,000
Total interest expense for 2021 $1,552,000
January 31, 2022 432,000
April 30, 2022 765,000
August 31, 2022 1,062,000
Total interest expense for 2022 $1,259,000
Total cost of building = $12,250,000
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Estimating ________ is one part of managing shortminusterm cash needs. The second part is estimating ________.
(A) cash inflow; accounts payable
(B) cash inflow; cash outflow
(C) accounts receivable; cash outflow
(D) accounts receivable; cash inflow
Answer:
(B) cash inflow; cash outflow
Explanation:
There are two parts i.e cash inflow and cash outflow.
The cash inflow is increase the cash balance whereas the cash outflow is decrease the cash balance
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There are three types of activities in the cash flow statement which are described below:
1. Operating activities: It includes those transactions which affect the working capital after net income. The increase in current assets and a decrease in current liabilities would be deducted whereas the decrease in current assets and an increase in current liabilities would be added.
These changes in working capital would be adjusted. Moreover, the depreciation expense is added to the net income
2. Investing activities: It records those activities which include purchase and sale of the long term assets. The purchase is an outflow of cash whereas sale is an inflow of cash
3. Financing activities: It records those activities which affect the long term liability and shareholder equity balance. The issue of shares is an inflow of cash whereas redemption and dividend is an outflow of cash.
The deadweight loss from a tax is likely to be greater with a good that has:
A. -many substitute B -an inelastic supply
C -an inelastic demandD. -few compliments
Answer:
A. -many substitute
Explanation:
Deadweight loss is inefficiency that occurs as a result of taxation. It's the change in production or consumption as a result of tax.
If tax is imposed on a good with many substitutes, the deadweight loss would be greater because consumers can easily shift consumption to another good that is cheaper.
If a good has inelastic supply or demand, the deadweight loss is less because consumers and producers do not change quantity demanded and supplied if prices increase as a result of tax.
I hope my answer helps you.
A company provided the following data:Selling price per unit $60Variable cost per unit 40Total fixed costs 400,000How many units must be sold to earn a profit of $40,000?
a. 2,000b. 20,000c. 22,000d. 8,500e. 23,333
Answer:
Option (C) is correct.
Explanation:
Sale - Variable cost = Contribution Margin
Contribution Margin - Fixed cost = Profit
(Selling Price – Variable cost) × No of units sold = Target profit + Fixed costs
($60 - $40) × No of units sold = $40,000 + $400,000
($20) × No of units sold = $440,000
No. of units sold = 22,000 units
In order to earn a profit of $40,000, the company must sell 22,000 units.
Darnell lives in San Francisco and runs a business that sells pianos. In an average year, he receives $723,000 from selling pianos. Of this sales revenue, he must pay the manufacturer a wholesale cost of $423,000; he also pays wages and utility bills totaling $267,000. He owns his showroom; if he chooses to rent it out, he will receive $2,000 in rent per year. Assume that the value of this showroom does not depreciate over the year. Also, if Darnell does not operate this piano business, he can work as a financial advisor and receive an annual salary of $20,000 with no additional monetary costs. No other costs are incurred in running this piano business.
Identify each of Darnell's costs in the following table as either an implicit cost or an explicit cost of selling pianos.
Implicit Cost
Explicit Cost
The rental income Darnell could receive if he chose to rent out his showroom
The wages and utility bills that Darnell pays
The salary Darnell could earn if he worked as a financial advisor
The wholesale cost for the pianos that Darnell pays the manufacturer
Complete the following table by determining Darnell's accounting and economic profit of his piano business.
Profit
(Dollars)
Accounting Profit
Economic Profit
If Darnell's goal is to maximize his economic profit, heshould stay in the piano business because the economic profit he would earn as a financial advisor would be.
Answer:
See explanation.
Explanation:
Implicit costs are the opportunity costs or costs of doing the next best alternative where as explicit costs are the direct accounting costs associated with an activity.
The rental income Darnell could receive if he chose to rent out his showroom is the implicit cost as this is an alternative he can chose against piano business.
The wages and utility bills that Darnell pays are the explicit costs as they are direct accounting costs of running the piano business.
The salary Darnell could earn if he worked as a financial adviser is the implicit cost as this is again the cost of an alternative.
The wholesale cost for the pianos that Darnell pays the manufacturer is the direct cost of goods sold and as such an explicit cost.
Accounting Profit = Revenue - Explicit costs
Accounting Profit = 723,000 - 423,000 - 267,000 = $33,000
Economic Profit = Revenue - Explicit Costs - Implicit Costs
Economic Profits = 723,000-423,000-267,000-2000-20,000 = $11,000
The economic profit earned from working as a financial adviser
Eco Profit as an adviser = 20000 + 2,000 - 33,000 = $ - 11,000
Since the Economic profit from working as an adviser is negative and less than that of selling pianos, it is profitable to stay in the piano business.
Hope that helps.
What idea did both the Regulators and Stamp Act Congress share? a. Colonial governors should make decisions unilaterally. b. Boycotts did not work as a means of protest. c. Colonists wanted to be represented in the government. d. There should be no taxes under any circumstances. e. Native Americans should remain in control of land west of the Appalachians.
Answer:
the correct answer is
c. Colonists wanted to be represented in the government.
good luck
Both the Regulators and the Stamp Act Congress held the view that colonists wanted to be represented in the government, protesting against British-imposed taxation without such representation.
The idea that both the Regulators and Stamp Act Congress shared was that colonists wanted to be represented in the government. This concept is famously encapsulated in the slogan “no taxation without representation.” Both groups believed that it was unjust for the British Parliament to impose taxes on the colonies without the colonies having representatives in Parliament. The Stamp Act Congress drafted the Declaration of Rights and Grievances, which protested taxation without representation, while influential writings like John Dickinson's “Letters from a Pennsylvania Farmer” echoed the sentiment that colonists were being treated as slaves due to the lack of consent in taxation. Furthermore, organized boycotts and protests by the colonists put economic pressure on British goods, indicating their united stance on the desire for representation and fair treatment under British governance.
In the bond market, the bond demanders are the ________ and the bond suppliers are the ________.
Answer:
In the bond market, the bond demanders are the lenders and the bond suppliers are the borrowers.
Explanation:
There are two operations on the bond market.
Lending, in which a participant demands a bond.
Borrowing, in which a participant supplies a bond.
So
In the bond market, the bond demanders are the lenders and the bond suppliers are the borrowers.
Martin is offered an investment where for $6000 today, he will receive $6180 in one year. He decides to borrow $6000 from the bank to make this investment. What is the maximum interest rate the bank needs to offer on the loan if Martin is at least to break even on this investment?A) 3%B) 4%C) 2%D) 1%
Answer:
maximum interest rate = 3%
so correct option is A) 3%
Explanation:
given data
investment = $6000
receive = $6180
borrow = $6000
to find out
maximum interest rate bank needs to offer on the loan
solution
we consider here maximum interest rate bank needs to offer is = r
so value of investment will be express here as
value of investment = amount to be borrowed × ( 1 + r ) ................1
put here value we get rate r
6180 = 6000 × ( 1 + r )
solve it we get
rate = 0.03
maximum interest rate = 3%
so correct option is A) 3%
Leandro has 16 hours per day that he can allocate to work or leisure. His job pays a wage rate of $20. Leandro decides to consume 8 hours of leisure. His indifference curves have the usual shape: they slope downward, they do not cross, and they have the characteristic convex shape. Draw Leandro's time allocation budget line for a typical day, with income on the vertical axis and hours of leisure on the horizontal axis. Then illustrate the indifference curve at his optimal choice. Based on the graph, choose the correct statement.
a. If Leandro chooses to consume 8 hours of leisure, then his income would be $320.
b. At his chosen bundle, Leandro will work for 8 hours, and his income would be $160.
c. The slope of the time allocation budget line is 20.
d. The opportunity cost of leisure is 20.
Answer: A. If Leandro chooses to consume 8 hours of leisure, then his income would be $320
Explanation:
As the question states that Leandro spends 8 hours out of 16 hours in leisure time. If Leandro spends all the 16 hours in work he would earn (16 x $20) = $320.
I have attached the picture of the graph for understanding.
The graph indicates that the correct statement is D. The opportunity cost of leisure is 20.
What is opportunity cost?The opportunity cost of a particular activity option is the loss of value or benefit that would be incurred by engaging in that activity.
On a typical day, maximum income or consumption Leonardo can have I =(16-L)20 where L= his leisure time and wage rate per hour =20.
In this case, to consume one hour of leisure Leonardo have to give up 20 dollars of income that he could have earned from working. Therefore, the opportunity cost of leisure is 20.
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Binding arbitration:
A. should be used to settle disputes only if the principle of caveat emptor does not apply.
B. requires that a terminated project be completed before damages are awarded.
C. requires empanelment of equal numbers from both the client and project organizations to reach a verdict.
D. can settle outstanding claims or disputes provided that all parties agree to its use.
Answer:D. can settle outstanding claims or disputes provided that all parties agree to its use.
Explanation: Binding arbitration is a type of arbitration/ dispute resolution where both parties involved in the dispute/ conflict choose a mediator mainly a legal practitioner and accepted to stand by the decision of the Binding arbitrator.
This type of arbitration is in contrast to non Binding arbitration where both parties are may not accept the decision of the arbitrator. Binding
Arbitration is adopted mainly in private disputes where both parties involved in the dispute agree to accept the verdicts of the trusted arbitrator.
According to purchasing power parity, if the Federal Reserve increased the money supply leading to higher U.S. inflation, then
(a) U.S. prices would rise and the nominal exchange rate would rise.
(b) U.S. prices would rise and the nominal exchange rate would fall.
(c) U.S. prices would fall and the nominal exchange rate would rise.
(d) U.S. prices and the nominal exchange rate would fall.
Answer:
b. U.S. prices would rise and the nominal exchange rate would fall.
Explanation:
The increased inflation increases the US prices and the exchange rate falls because import from US decreases and the US start importing more so the value of dollar decreases.
Economist Bruce Kirchhoff contends that business failures are much lower than traditionally reported.
A. True
B. False
"ATC has a value of $70,000 in a good economy and $55,000 in a recession. The firm has $60,000 of debt. The probability of a recession is 50 percent. The firm is considering a project that would change the firm values to $73,000 in a good economy and $50,000 in a recession. If the firm accepts this project, the firm value will ______ and shareholder value will ______."
Answer:
The firm value will decrease by $1,000 and shareholder value will increase by $1,500
Explanation:
Data provided in the question:
Value of ATC in a good economy = $70,000
Value of ATC in recession = $55,000
Debt = $60,000
Probability of a recession = 50%
Final firm value in a good economy = $73,000
Final firm value in recession = $50,000
Now,
Expected total value = ∑(value × Probability)
= ( $73,000 × 50% ) + ( $50,000 × 50% )
= $36,500 + $25,000
= $61,500
Therefore,
Shareholder value = Expected total value - Debt
= $61,500 - $60,000
= $1,500 [Positive value means an increase]
Expected change in firm value = ∑(Change in value × Probability)
= [ ($73,000 - $70,000) × 50% ] + [ ($50,000 - $55,000) × 50% ]
= $1,500 + (- $2,500)
= -$1,000 [Here, negative value means a decrease ]
Hence,
The firm value will decrease by $1,000 and shareholder value will increase by $1,500
Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump product line follows: Thalassines Kataskeves, S.A. Income Statement—Bilge Pump For the Quarter Ended March 31 Sales $ 440,000 Variable expenses: Variable manufacturing expenses $ 124,000 Sales commissions 47,000 Shipping 23,000 Total variable expenses 194,000 Contribution margin 246,000 Fixed expenses: Advertising (for the bilge pump product line) 23,000 Depreciation of equipment (no resale value) 108,000 General factory overhead 45,000 * Salary of product-line manager 126,000 Insurance on inventories 8,000 Purchasing department 46,000 † Total fixed expenses 356,000 Net operating loss $ (110,000 ) *Common costs allocated on the basis of machine-hours. †Common costs allocated on the basis of sales dollars. Discontinuing the bilge pump product line would not affect sales of other product lines and would have no effect on the company’s total general factory overhead or total Purchasing Department expenses. Required: What is the financial advantage (disadvantage) of discontinuing the bilge pump product line?
Answer:
- $89,000
Explanation:
The computation of the financial advantage or disadvantage is shown below:
= Contribution margin loss - fixed expense
where,
Contribution margin is - $246,000
And, the fixed expense would be
= Advertising (for the bilge pump product line) + Salary of product-line manager + Insurance on inventories
= $23,000 + $126,000 + $8,000
= $157,000
Now put these values to the above formula
So, the value would equal to
= - $246,000 - $157,000
= - $89,000
All other information which is given is not relevant. Hence, ignored it
The financial advantage of discontinuing the bilge pump product line would equal the total avoidable costs of $325,000 minus the current loss of $110,000, leading to a net financial benefit of $215,000.
Explanation:To determine the financial advantage or disadvantage of discontinuing the bilge pump product line, we must analyze the provided income statement to see which costs will be eliminated or reduced and which will remain unaffected. We'll focus on variable expenses directly associated with the product line and fixed expenses that will be removed if the product line is discontinued.
From the income statement, the variable expenses that would be eliminated if the bilge pump product line were discontinued are:
Variable manufacturing expenses: $124,000Sales commissions: $47,000Shipping: $23,000The total variable expenses amount to $194,000. Concerning fixed expenses, we are specifically looking for expenses that are directly attributed to the bilge pump product line only:
Advertising (for the bilge pump product line): $23,000Depreciation of equipment (no resale value, solely tied to the bilge pump product line): $108,000However, some fixed expenses like the general factory overhead and the purchasing department expenses would remain unaffected by this decision, as indicated in the question. Thus, these costs will continue even if the bilge pump line stops. We sum up all the avoidable costs ($194,000 + $23,000 + $108,000) to find the total savings of $325,000. As the product line is currently operating at a loss of $110,000, the company would experience a net financial advantage equal to the savings ($325,000) minus the loss ($110,000), resulting in a financial advantage of $215,000 if they discontinue the bilge pump product line.
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