Answer:
Counteroffer
Explanation:
A counteroffer can simply be defined as an offer made in response to another offer.
From the question, Don gets a lucrative offer from a rival advertising firm for his services but his present company proposes the same offer to keep Don from going to a rival company. The offer proposed by his present company is called a counteroffer.
When the price level rises from 110 to 115, the aggregate level of GDP supplied rises from $80 billion to $120 billion. This ________ relationship represents the ________ relationship between the quantity of real GDP firms are willing to supply and the price level.
Answer: positive ; short run
Explanation: In accordance to the law of supply, The quantity of goods supply increases as the price of the goods or services as firms tends to make the most the increase in price. This highlights a positive relationshio between piece and supply. The relationship is a short run relationship which es depicted by an upward sloping curve which lies above the variable cist curve within the curve if the marginal cost.
What option will NOT be available if you are behind on loan payments?
A) You can ask to get out of your loan.
B) You can borrow money from friends and family.
C) A financial institution may offer for you to pay a little now and pay the rest after your next pay day.
D) Your financial institution might allow you to defer the loan but you'll have to pay the interest.
The option that will not be available is that you can ask to get out of your loan, hence A is correct
What is a Loan?A loan can be defined as money that one borrows from an individual or a financial institution to repay with interest.
it should be noted that the interest paid in addition to the money is what makes it a loan.
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If you're behind on loan payments, the option to ask to get out of your loan won't be available. The correct answer is option Option A) You can ask to get out of your loan.
When you are behind on loan payments, financial institutions are less likely to offer the option to get out of the loan entirely. Instead, they may provide alternative solutions such as restructuring the loan, offering payment plans, or allowing deferment with accrued interest.
However, asking to get out of the loan altogether is typically not feasible, as it would result in a loss for the lender without repayment.
When behind on loan payments, options such as borrowing from friends and family, negotiating payment plans, or deferring the loan with interest may be available, but requesting to get out of the loan entirely is unlikely to be an option.
Tom decides to begin investing some portion of his annual bonus, beginning this year with $6,000. in the first year he earns a 8% return and adds $3,000 to his investment. in the second his portfolio loses 4% but, sticking to his plan, he adds $1,000 to his portfolio. in this year his portfolio returns 2%. what is tom's dollar-weighted average return on his investments?
Answer:
Tom's dollar-weighted average return on his investments is 1.20%
Explanation:
According to the given data we have the following:
CF0 = -6,000
CF1 = -3,000
CF2 = -1,000
The above figures are the amount invested by Tom in each year and hence are cash outflows.
CF3 = amount left in the portfolio after all the gains and losses on the portfolio.
So CF3 = ((((6,000*1.08)+3,000)*0.96)+1000)*1.02
The above equation will determine the amount of cash flow at the end of the 3rd year. 1.08 = 1+8% return, 0.96 = 1-4% loss and 1.02 = 1+2% return
Thus CF3 = ((((6,000*1.08)+3,000)*0.96)+1000)*1.02 = (((6480+3000)*0.96)+1000)*1.02
= ((9480*0.96)+1000)*1.02
= (9100.8+1000)*1.02
= 10,302.82
Let the dollar weighted average return be "x".
Thus,
Initial investment = CF1/(1+x)^1 + CF2/(1+x)^2 + CF3/(1+x)^3
6000 = -3000/(1+x) - 1000/(1+x)^2 + 10302.82/(1+x)^3
Solving in excel to find the above IRR (internal rate of return) we get the value of x as 1.20% (first option)
This can be verified also:
6000 = -3000/(1+1.2%)^1 - 1000/(1+1.2%)^2 + 10302.82/(1+1.2%)^3
or 6,000 = -2964.43 - 976.43 + 9940.64
Adding all the numbers in the right hand side gives us 6,000
Therefore, Tom's dollar-weighted average return on his investments is 1.20%
Final answer:
Tom's dollar-weighted average return on his investments, calculated in a simplified manner without exact timing of cash flows, is approximately 3.0282% over the three-year period.
Explanation:
To calculate Tom's dollar-weighted average return, we need to consider both the timing and the amount of each investment. Tom's first investment is $6,000 which earns an 8% return the first year. Therefore, at the end of year one, the investment is worth $6,000 imes 1.08 = $6,480. Tom then adds $3,000 to his investment, making the total $6,480 + $3,000 = $9,480. The second year, his portfolio loses 4%, so the value after the loss but before the next investment is $9,480 imes 0.96 = $9,100.80. He then adds $1,000, for a total of $9,100.80 + $1,000 = $10,100.80. After the third year, his portfolio increases by 2%, so the final value is $10,100.80 imes 1.02 = $10,302.82.
To find the dollar-weighted average return, we consider the periods individually. The first sum of $6,000 was invested for three years, the second sum of $3,000 was invested for two years, and the last sum of $1,000 was invested for one year. To decide whether the investment plan is working, we need to compare the final amount to the total of investments made, which is $6,000 + $3,000 + $1,000 = $10,000.
Tom's dollar-weighted average return can be estimated as follows: Final Value - Total Investment) / Total Investment, which gives us ($10,302.82 - $10,000) / $10,000 = 0.030282 or 3.0282%. However, this is a simplified estimation and doesn't take into account the exact timing of each cash flow.
If a nation is going to achieve and sustain a high rate of economic growth, it must
1 prohibit low-wage foreign producers from supplying goods to the domestic market.
2 have an abundant domestic supply of low cost energy resources.
3 have a mechanism capable of attracting savings and channeling them into wealth-creating projects.
4 impose regulations that will limit the intensity of competition among domestic firms.
Answer:
I think the answer is 3.
Explanation:
For a high economy, a nation must have wealth (well there are other factors too) and for wealth it must have a mechanism for attracting savings and channeling the for money and slowly slowly the economy will start growing.
true or false: Qualitative data represents the motivations or the ""whys"" behind much of the data that can be counted with numbers
Answer:
True
Explanation:
The reason is that the qualitative data is not a quantifiable data and it includes the whys which helps in understanding and individual opinion forming. The qualitative data can be counted and this counting increases the reliability of the data which means the conclusion drawn are more realistic in nature.
True, qualitative data is used to capture the motivations and 'whys' behind human behavior, providing in-depth understanding that numbers cannot express.
True: Qualitative data represents a type of information that is expressed in words rather than numbers. This data is crucial for understanding the motivations, thoughts, and emotions—the 'whys'—behind human behaviors and choices which can't be fully quantified. Qualitative data encompasses a wide range of non-numeric information such as personal experiences, feelings, and cultural practices, providing depth and context to the subjects being studied.
Qualitative data often comes from methods like interviews, observations, and focus groups. It can include descriptions of people's lifestyles, behaviors, or viewpoints, and provides insights into phenomena that need more detailed exploration than what mere numbers can convey. This includes aspects like hair color, emotions, or the reasoning behind certain actions within a cultural sociology study.
Researchers might prefer quantitative data for its ease of mathematical analysis; however, qualitative data adds essential narrative and substance when researchers wish to delve into people's reasons for acting a certain way that can't necessarily be measured. It's valuable in diverse fields of study, from cultural sociology to market research, since it offers perspectives on internal thought processes and personal experiences that numeric data alone cannot offer.
Susanne, the CEO of a national IT manufacturer, was approached by Simple Phones, a new company that is marketing a new type of phone, to partner with the company on a project. The results of the partnership are uncertain because the company (Simple Phones) and its technology are new. Susanne is uncertain what to do because she is limited by numerous constraints, such as the uncertainty and complexity of the technology, the management success of Simple Phones, and time (because other companies are interested in the partnership). Susanne is experiencingA. an ethical dilemmaB. bounded rationalityC. groupthinkD. a bounded dilemmaE. limited scope
Answer:
Bounded rationality
Explanation:
Decision making is an important aspect of every man, However good decision making is guided by a lot of principles
Bounded rationality mean that human rational at the point of decision making is limited . It can be further explained by the principle that a number of factors like the available information ,mindset and even time can limit the decision making capacity of an individual.
This best define the situation confronting Susanne in the scenario.
A new technique for extracting oil and gas—called "fracking"—spurred an economic boom in the formerly sleepy town of Oilville, located in what had been thought to be a depleted oil field. Workers swarmed into the town, and Karen started a laundry service to meet their needs. In this case, Karen had spotted an entrepreneurial opportunity created by the new extraction technique, or a ___________________, which in turn created an oil boom, or a(n) __________________.
Answer: technological discovery; economic dislocation
Explanation:
In the scenario described, Karen had spotted an entrepreneurial opportunity that was created by the new extraction technique, or a technological discovery. When there's a technological discovery, there will be new opportunities for people.
The technological discovery created an oil boom or an economic dislocation. When there's a change in economic conditions as a result of displacement of some workers, we say the affected people have been dislocated from the affected economy, in terms of employment.
Justin Justice owns 55% of the outstanding stock of Rego Corporation. During the current year, Rego sold a trailer to Justin for $10,000. The trailer had an adjusted tax basis of $12,000 and had been owned by Rego for 3 years. In its current-year income tax return, what is the allowable loss that Rego can claim on the sale of this trailer?
A. $0.
B. $2,000 ordinary loss.
C. $2,000 Sec. 1231 loss.
D. $2,000 Sec. 1245 loss.
Answer:
A. $0.
Explanation:
Tax Basis means that the acquisition cost plus any other cost incurred to make use of that asset. In this case tax basis of trailer is $12,000 but had been owned by Rego for 3 years which means it must have been depreciated over these 3 years. So, if the trailer is sold for $10,000 it must have profit and not any loss, so the allowable loss for Rego would be $0.
Justin Justice bought a trailer from Rego Corporation, in which he owns a significant amount of stock, for less than its adjusted tax basis which resulted in a $2,000 loss for the corporation. However, the Internal Revenue Service does not typically allow losses on sales to related parties, therefore, the allowable loss Rego can claim on their taxes from this sale is likely $0.
Explanation:The question that you're asking is related to the tax implications of a transaction between a corporation and its significant shareholder. Justin Justice owns 55% of the outstanding shares in Rego Corporation, and he bought a trailer from the company for $10,000 which originally had an adjusted tax basis of $12,000. Rego Corporation is therefore experiencing a loss of $2,000 on this particular transaction. The type of loss that would be reported on a tax return would depend largely on tax regulations. However, considering the information provided in the question, the Internal Revenue Service (IRS) generally does not allow losses on sales to related parties. This suggests that the allowable loss that Rego can claim on the sale of this trailer during the current year's income tax return would be $0.
Given this, the correct answer would be A. $0.
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In the event of a "stockout" one of the things that could happen is __________________________________. a. the vendor's plant shuts down. b. the cost of capital is increased. c. the SCOR process would come into play. d. extra shipping cost may be incurred.
Answer:
d. extra shipping cost may be incurred.
Explanation:
Stockout means that a production company has no inventories to produce goods, which is a bad thing that can happen to a company. It means that production has stopped and customers cannot be supplied with order they have made.
There are several effects of stock out on a business, one of which is extra shipping cost may be incurred. A customer that is not ready to wait for his or her order to be met may have the item backorder expecially If the order was part of a larger delivery, then there would be backorder which will require special transportation.
Customers may also cancel his or her order and such customer is lost forever. This customer may also inform other customers thereby spreading bad news about the company which may reduce further sales of the company in the future.
When a company losses a customer as a result of stock out, or is no longer placing an order, a cost(cost of finding a customer a customer to replace the order which would have been purchased) is associated with that which will be borne by the vendor or the company.
Hugo, a sales representative at chillout inc., a company that supplies frozen foods to supermarkets, is required to travel to the stores to meet their managers and view their inventory. after a recent road accident, hugo's left hand became severely impaired and only his right hand is functional. hugo requests that the company install an one-hand driving system, costing $35,000 to $45,000, in one of its minivans so that he can drive it. based on the size and financial position of the company, this cost is more than it can afford. chillout should convey to hugo that:
Answer:
He can't ask such an accommodation but instead he can ask for sharing of the cost of the accommodation.
Explanation:
The reason is that the company can't afford that accommodation expenses, so the only left option which morally correct is that the company must donate money which is the portion of that accommodation. So he can't ask such an accommodation but instead he can ask for sharing of the cost of the accommodation.
A stadium makes $1,000,000 in revenue from a recent event. Due to its smaller size, the neighboring arena is expected to make 46% of what the stadium makes in revenue. How much revenue is the arena expected to make?
Answer: $460,000
Explanation:
A stadium makes $1,000,000 in revenue from a recent event and the neighboring arena will make 46% of what the stadium makes in revenue.
This means the neighboring arena will make 46% of $1,000,000. This can be expressed as:
46% of $1,000,000
= 46/100 × 1,000,000
= $460,000
The neighboring arena will make $460,000.
An organization selling its products FOB destination holds the title to the goods until ________________________________. a. picked up by the trucker b. products reach the customer's facility c. the customer is invoiced d. the customer receives the goods into their inventory system
Answer: Products reach the customer's facility
Explanation:
Free on Board or Freight on Board(FOB) is a shipping term that is used in retail to show who is responsible for the payment of transportation charges. Freight on Board is the location where the ownership of the merchandise transfers from the seller to buyer.
An organization selling its goods FOB destination holds the title to the goods until the moment the goods get to the customer's facility.
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Keisha wanted to sell cupcakes at school. Keisha asked her parents whether she could use their kitchen if she provided them with a percentage of the profits; she asked her friends for help making and selling the cupcakes in return for a percentage of the profits, and she asked the permission of the principal to sell the cupcakes at school.
Keisha’s actions are BEST described as providing what type of productive resource?
A labor
B human capital
C physical capital
D entrepreneurship
Answer:
D. entrepreneurshipExplanation:
Entrepreneurship is one among the different types of productive resources that can be applied to produce goods and services. Enterprise is a human ability or an action of organizing the different types of productive resources to produce goods and services in the most profitable and productive way.It is a set of skills that individuals may use or apply while trying to produce a good.Keisha negotiating with her parents and friends to give them a share of profit if they rendered their goods and services and asking permission from her principal is an entrepreneurial tactic which she is using to make her cupcakes sale successful.Every month, Charlotte receives a bill in the mail from her mortgage company. By the first of each month, she must send back her payment along with the bottom part of the bill, which includes her account information and the amount enclosed. She pays these mortgage bills using a form of payment that is essentially a written order to her bank to pay the mortgage company the specified amount from the money in her bank account. What form of payment is Charlotte using in this scenario
Complete/Correct Question:
Every month, Charlotte receives a bill in the mail from her mortgage company. By the first of each month, she must send back her oayment, along with the bottom part of the bill, which includes her account information and the amount enclosed. She pays these mortgage bills using a form of payment that is essentially a written order to her bank to pay the mortgage company the specified amount from the money in her bank account. What form of payment is Charlotte using in this scenario?
A) a check
B) a debit payment
C) a certificate of deposit
D) paper money
E) a line of credit
Answer:
A, a check
Explanation:
A check is a written order informing a bank to pay a certain amount of money as stipulated in it to a certain individual, company, etc. The amount stipulated in the check is paid from the account of the check owner or checking account owner to the individual whose name appears on the check as the recipient.
The drawer is the name of the name of the person that owns the transaction account from which the payment is to be made while the drawee is the person to whom the payment is to be made.
In the question above, Charlotte writes a check. The check orders her bank to pay the mortgage company whatever amount she has stipulated on the check.
Cheers.
Think of the last item you purchased. What was the item and what strategies did you use to help in your decision-making process? Based on what you learned in this module, what strategies can you use next time?
Answer: Decision method for item bought was identification, weighing of alternative and quality
Explanation:
The item I purchased last was a game pad. When buying a game pad I had various options with variety in prices and durability. I wanted something that's authentic and would last over a period of time.
My choice was based on;
•Identification of item
•Quality
When considering getting an item next time I'll still go with these methods as they guide in making the best decision.
the price of dog leashes increased 5% and the quantity demanded of dog collars decreased 7%. calculate the cross-price elasticity of demand for dog collars. round your answer to the nearest hundredth. be sure to include a negative sign in your answer, if necessary.
Answer:
-1.4
Explanation:
Cross price elasticity of demand is calculated by dividing the percentage change in the demand of one good divided by the percentage change in price of another good
Percentage change in price of Dog leashes = 5%
Percentage change in quantity demanded of dog collars = -7%
Cross price elasticity = percentage change in quantity of dog collars / percentage change in price of dog lashes
=-7/5*100= -1.4
Firms that have selected a related diversification corporate-level strategy seek to exploit: a. market power. b. control shared among business-unit managers. c. economies of scope between business units. d. the favorable demand of buyers.
Answer:
C, economies of scope between business units
Explanation:
A corporate-level strategy is a strategy that a firm adopts to measure the returns of the companies businesses having used a corporate level strategy as against what the result would e without the strategy.
In corporate-level strategy, a firm knows how each of its businesses are doing and if it should continue or not and therefore helps the firm the priority to be given to each of its businesses.
Cheers.
Zack Shields leases a manufacturing facility that produces computer monitors. Zack tries to keep production high, because his lease payments are $10,500 a month, regardless of whether he produces one computer monitor a month or 10,000. Zach's lease payment is a ________ cost.
Answer: Fixed payment
Explanation: Usually loans come with a variable interest rates, that change over time or fixed rates. When it’s a fixed rate, you will have to pay the same amount (not changing) interest rate over the period of the loan. Interest rates Are usually affected by changes constantly because the economy grows and contracts. But with a fixed rate, your loan is not affected by those changes. This is same as the example no matter how many computers monitors he produces in a month his lease doesn’t increase because it is fixed.
Let mp = marginal product, p = output price, and w = wage, then the equation that represents a situation where a competitive firm should lay off some workers to maximize profits is
Final answer:
A competitive firm should lay off workers to maximize profits when the wage it must pay is greater than the value of the marginal product (MP x p) of the last worker hired.
Explanation:
The question refers to the condition under which a competitive firm should lay off some workers to maximize profits. According to the principles of microeconomics, a profit-maximizing firm in a perfectly competitive market will hire workers up to the point where the market wage equals the marginal revenue product (MRP), which is the additional revenue the firm earns from hiring one more worker. In mathematical terms, this condition is when w = MP × p. If the wage, w, that the firm must pay is greater than the additional revenue generated from the last unit of labor hired (MP × p), it means the firm is not maximizing profits and should lay off workers until equality is reached.
I need help please!!! Thank you
Answer: A.?
Explanation: I would personally think it's A but if not it could be D.
What is the difference between a variable expense and a fixed expense?
Answer:
In a Fixed Expense there is no change in the price. Examples of fixed expenses are things such as Rent, Car payments, dues and insurance (just to name a few of the top of my head).
In a Variable Expense, things are subject to change over time, they change based on circumstances. Examples of Variable Expenses are, gas prices, groceries, electrical bills, and services that charge based on work completed.
Short Answer: (Summary)
So to summarize, Fixed Expenses stay the same, Variable Expenses are likely to change.
Explanation:
So let's think about the concept between the two terms, Fixed Expense and Variable Expense. In a fixed anything there is no change, as opposed to variables which are subject to changes based on the situation, (they adapt I guess).
Fixed costs are expenses that remain constant regardless of production levels, such as rent or machinery costs. Variable costs, however, fluctuate based on the level of production, and they include expenses like materials, labor, or utility costs
Explanation:The difference between a variable expense and a fixed expense predominantly revolves around their variance in relation to the level of productivity or output. Fixed costs are expenditures that do not change regardless of the level of production. These include costs like rent, machinery purchases, or research and development costs, all of which stay the same whether you produce a lot or a little. For instance, once you sign a lease for a factory or a retail space, the rent remains the same no matter how much you produce.
On the other hand, variable costs are those expenses that change with the level of production. They are costs incurred in the act of producing and can include expenses related to materials, labor, and utility costs associated with manufacturing. These costs generally show diminishing marginal returns, meaning the marginal cost of producing higher levels of output rises.
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Stoneheart Group is expected to pay a dividend of $3.05 next year. The company's dividend growth rate is expected to be 4.5 percent indefinitely and investors require a return of 11.1 percent on the company's stock. What is the stock price?
The stock price of Stoneheart Group is approximately $46.21.
The dividend growth model is a method used to estimate the value of a company's stock.
To calculate the stock price using the dividend growth model (also known as the Gordon Growth Model), we can use the formula:
Stock value = Dividend per share / (Required Rate of Return – Dividend Growth Rate)
Where,
Dividend per Share = $3.05 (expected dividend next year)
Dividend Growth Rate = 4.5% (0.045)
Required Rate of Return = 11.1% (0.111)
To calculate Stock Price,
Stock Value = 3.05 / ( 0.111 - 0.045 )
= 3.05 / 0.066
= $46.21
Hence, the stock price of Stoneheart Group is approximately $46.21 .
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Which of the following is NOT an advantage of owning a car?
A) Yours to keep and sell when you wish
B) Flexibility to be able to customize it
C) Drive unlimited number of miles
D) Smaller down and monthly payments than leasing a car
Answer: D
Example: D is the answer because everything else other than painting does not cost money and if you do not pay your payments you can go to jail and get you license taken.
Big House Nursery Inc. Has issued 20minusyear $1,000 face value, 8% annual coupon bonds, with a yield to maturity of 10%. The current price of the bond is ________.
Answer:
The current price of the bond is $800
Explanation:
The Yield to Maturity (YTM) is the long term yield on a bond. It is the yield that is expected from the bond based on the assumption that if the bond is purchased today and is held to maturity.
The YTM can be calculated as presented in the attachment to the answer.
As we already know the YTM and the other components of YTM formula, we can input these in the formula to calculate the Current Price of the bond.
Current Price of the bond will be,
0.1 = 80 + [(1000 - P) / 20] / [(1000 + P) / 2]
0.1 = 80 + [50 - 0.05P] / [500 + 0.5P]
0.1 * (500 + 0.5P) = 80 + 50 - 0.05P
50 + 0.05P = 130 - 0.05P
0.05P + 0.05P = 130 - 50
0.1P = 80
P = 80 / 0.1
P = $800
P = $800
A council health inspector threatens to close down a restaurant by issuing a fake health violation notice if the owner does not make a financial payment to him. If the restaurant owner does not cooperate, the restaurant cannot be opened for business and the negative publicity will drive customers away. Faced with the potential economic loss, the owner makes the payment. Required:a)What type of fraud is this? b)What controls can be implemented to prevent or detect the fraud?
Answer:
Part A. Economic Extortion.
Part B. Having an Internal Audit Department and proven whistle-blower policy.
Explanation:
Part A. In the Economic Extortion case, the person with power threatens the other party by its undue use against the party. This undue advantage of power forces the other party to fulfill the desires of the party with powers.
Part B. Having effective internal control department and whistle-blower policy can help the company to identify such fraudulent activities going on in the county. An internal audit department would investigate the breaches of the company policies. Furthermore, the whistle-blower policy helps in indicating the misuse of the powers within the organization.
A charge of 12–18 percent is levied by the government of a foreign nation on the value of automobile accessories imported from a neighboring country. This increased the price of those imported car accessories for the consumers. This foreign nation is using a(n)
a.import quota
b.ad valorem tariff
c.Antidumping duty
d.Local content tariff
e.subsidy
Answer:
B. ad valorem tariff
Explanation:
Shipp, inc. manufactures a product requiring two pounds of direct material. during 2016, shipp purchases 24,000 pounds of material for $99,200 when the standard price per pound is $4. during 2016, shipp uses 22,000 pounds to make 12,000 products. the standard direct material cost per unit of finished product is
Answer: $8
Explanation:
Required amount of Raw material for each unit of the product = 2 pounds
Therefore, for 12,000 units of product,
raw material required equals :
12,000 × 2 = 24,000 pounds
Standard price per pound equals $4
Therefore, Standard cost of 24,000 pounds of material equals :
24,000 × $4 = $96,000
Cost per unit equals :
(Total cost ÷ Number of Units)
$96,000 ÷ 12,000 = $8
Therefore, the standard direct material cost per unit of finished product is $8
The Marriott Hotel in downtown Chicago decreases its room rate on the weekends, because its busiest times are during the week when business travelers are in the city. This activity highlights the service characteristic of ________.
Final answer:
The Marriott Hotel's pricing strategy illustrates the concept of 'perishability' in services, where the service cannot be stored and must be sold at the time of availability to avoid loss.
Explanation:
The service characteristic highlighted by the Marriott Hotel in downtown Chicago decreasing its room rates on the weekends is perishability. Perishability in services refers to the fact that services cannot be stored for later sale or use. Since hotel rooms are a service that cannot be 'saved' and sold at a later time, hotels often adjust their pricing to match demand, lowering rates during off-peak times to attract more customers.
Wholesome Cuisine, a frozen foods company, decides to create a new mail order meal division, focused on offering delicious food that is also healthy and easy to prepare. Wholesome Cuisine forms a team of nutritionists, chefs, food critics, and packaging engineers who work together to develop easy-to-prepare meals that are healthy, balanced, and tasty. Which step in the product development process does this scenario best describe?
Answer:
Idea development
Explanation:
At the idea development stage, the company just decides to appraise and investigate whether the innovative idea is feasible and that will it generate value for the company in the long term. Furthermore, the idea is just a theoretical information that just sounds good for the business future and there is further investigation pending to appraise it.
Suppose that a firm earned $500,000 in total revenue. At the same time, it incurred labor costs of $200,000; economic depreciation of $50,000; normal profit of $75,000; interest paid to the bank of $25,000; and used other factors of production that cost $100,000. The economic profit earned by the firm equals:
Answer: $50,000
Explanation:
Given the following ;
Total Revenue = $500,000
Labor cost = $200,000
Economic Depreciation = $50,000
Normal profit = $75,000
Interest paid to bank = $25,000
Other cost of production = $100,000
Economic profit = (Total revenue - labor cost - economic Depreciation - normal profit - interest paid to bank - other production cost))
Economic profit =$ (500,000 - 200,000 - 50,000 - 75,000 - 25,000 - 100,000)
Economic profit = $50,000