According to Critical Chain Project Management principles, project buffer protects the project completion date against the negative effects of project multitasking. the correct answer is: A) The project completion date against the negative effects of project multitasking C) A single time estimate for activity durations is used.
According to Critical Chain Project Management principles, project buffer protects the project completion date against the negative effects of project multitasking. Project buffer is a time reserve that's utilized to protect the project completion date against the negative effects of project multitasking. The project buffer functions to buffer the critical chain activities against variations, thus reducing the likelihood of delays to the project completion date.The critical chain is identical to the critical path in a project where a single time estimate for activity durations is used. The critical chain and critical path are both used to plan and monitor project activities. The critical chain differs from the critical path in that it takes into account resource constraints and their impact on the project completion date. Meanwhile, the critical path uses a single time estimate for activity durations. So, the correct answer is: A) The project completion date against the negative effects of project multitasking C) A single time estimate for activity durations is used
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Although the unemployment rate is not a perfect measure (falling to account for potential increases in discouraged or underemployed workers), it remains a key indicator of a nation's economic health. While Germany now enjoys a healthy unemployment rate of only 3.6% as of December 2017, the labor market has not always been booming in this European country. For example, as recently as 2005, German unemployment accounted for nearly 10% of the labor force. There are many factors that contributed to the turnaround of Germany's labor market over the last decade, including wage decentralization and increased competitiveness according to an article from the Harvard Business Review (Alexandra Spitz-Oener, "The Real Reason the German Labor Market Is Booming," March 13, 2017). However, one of the most well-known policy changes of the early 21st century was the Hartz reforms, which included a sharp decrease in unemployment benefits that altered the incentives of unemployed workers. Before the enactment of the reforms, eligible Germans received 60% to 67% of their previous net salaries for 12 to 36 months, after which period they continued to receive 53% to 57%. After the reforms were enacted in 2005, the full unemployment benefits ( 60% to 67%) were only available for a year (or 18 months for those over 55); after that, the benefits decreased sharply, and claimants were forced to agree to a contract requiring them to take steps toward finding a job. This tightening of unemployment benefits encouraged the unemployed to find jobs by making long-term unemployment an unattractive option. While the cost to those who remained unemployed must be weighed against the overall benefit to the economy, this example illustrates how people respond to changes in incentives.
The turnaround in Germany's labor market over the last decade can be attributed to various factors, including wage decentralization, increased competitiveness, and policy changes such as the Hartz reforms.
One of the most significant policy changes was the sharp decrease in unemployment benefits, which altered the incentives for unemployed workers. Prior to the reforms, eligible Germans received 60% to 67% of their previous net salaries for 12 to 36 months, followed by a decrease to 53% to 57% thereafter. However, after the reforms were enacted in 2005, full unemployment benefits were only available for a year (or 18 months for those over 55), and then sharply decreased. Claimants were also required to agree to a contract that mandated steps toward finding a job.
This change in unemployment benefits made long-term unemployment less attractive and encouraged the unemployed to actively seek employment. While the impact on those who remained unemployed must be considered, this example highlights the responsiveness of individuals to changes in incentives.
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Question 10 out of one If retained earnings at the beginning of the 2020 is 500,000, overstatement in 2019 income statement is 50,000, niet income for 2020 * 54,000 w dividend for 2020 is zero Ino dividend dedared). How much is retained earnings at the end of 2020, Answers A. 600,000 B. 500,000 c. 400,000 D. 100,000 Tout of po Question 8 In accounting for disposal of assets, accumulated depreciation refers to Answers: А Fair value of assets B. Total depreciation since acquisition of the asset c Book value less total depreciation D. Depreciation expenses in the year of sale Question 4 1 out of 1 pc An asset was bought in 2015 at a purchase price of 70,000 AED. Depreciation is 10% annually. After 5 years, what is the asset's historical cost) Answers A 105.000 8. 63,000 C 35,000 0.70,000
If retained earnings at the beginning of the 2020 is 500,000, overstated in 2019 income statement is 50,000, net income for 2020 is 54,000 w/ dividend for 2020 is zero (no dividend declared).
To determine the retained earnings at the end of 2020, we need to use the formula: Retained Earnings = Retained earnings at the beginning of the year + Net Income - Dividends (or Declared Dividends).Given that, Retained earnings at the beginning of the year = 500,000Overstatement in 2019 income statement = 50,000Net income for 2020 = 54,000Dividend for 2020 = zero
Therefore, Retained Earnings = 500,000 + 54,000 - 0- 50,000= 504,000Thus, the retained earnings at the end of 2020 is 504,000. Answer: More than 100 words.
In accounting for the disposal of assets, accumulated depreciation refers to: In accounting for the disposal of assets, accumulated depreciation refers to the book value less total depreciation on the asset. Accumulated depreciation is the cumulative amount of depreciation that has been charged on the asset from the date of purchase until the date of disposal of the asset. It is a contra-asset account that is used to reduce the book value of the asset on the balance sheet. The accumulated depreciation is added to the original cost of the asset to determine the book value of the asset. When the asset is sold or disposed of, the accumulated depreciation is subtracted from the original cost of the asset to determine the gain or loss on disposal.
Question 4:An asset was bought in 2015 at a purchase price of 70,000 AED. Depreciation is 10% annually. After 5 years, what is the asset's historical cost?To calculate the historical cost of an asset, we need to know the purchase price and the total depreciation that has been charged on the asset.
The total depreciation charged on the asset can be calculated by multiplying the depreciation rate by the purchase price.
Given that, Depreciation rate = 10%Purchase price = 70,000 AED After 5 years, the total depreciation charged on the asset is: Total depreciation = Depreciation rate x Purchase price x Number of years= 10% x 70,000 x 5= 35,000 AED Therefore, the historical cost of the asset after 5 years = Purchase price - Total depreciation= 70,000 - 35,000= 35,000 AED Thus, the historical cost of the asset after 5 years is 35,000 AED.
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What did you learn from this Netflix success?
In your opinion, what were the most important factors that lead to Netflix’s success?
If you had to make a change to Netflix today, what would it be?
Netflix has been a successful and innovative streaming platform that has disrupted the entertainment industry. From its humble beginnings as a DVD rental company to a streaming giant, Netflix's success can be attributed to its ability to adapt and reinvent itself to meet its customer's needs.
Netflix has become a leader in the production of award-winning original programming. These series and movies keep their customers engaged, drive new subscribers, and distinguish them from their competitors. Netflix spends billions of dollars each year to produce original content, and the success of the company can be attributed to the fact that they produce content that people want to watch.Netflix is an expert in personalization. The platform uses data to understand the viewing habits of its customers and recommends shows based on the customer's interests. This personalization and algorithm-based viewing have been key to their success. Another lesson that we can learn from Netflix is that customer-centricity is crucial. The company focuses on providing exceptional customer service to ensure that their subscribers have a seamless and enjoyable experience. They have invested in a responsive customer service team that helps users with their inquiries or concerns. Netflix also recognizes the importance of simplicity, which is why its platform is user-friendly and easy to navigate.If I had to make a change to Netflix today, it would be to provide more options for users to choose from. While Netflix already provides an extensive collection of shows and movies, it would be great to have more control over content filtering.For such more questions on Netflix
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An industry's key success factors Copyright by Glo-Bus Software, Inc. Copying, distributing, orded party website posting sexpressly prohibited and constitutes copyright violation O concern those strategy elements that must be included in any company's strategy in order to achieve a sustainable competitive advantage over rival companies. Oare a function of how rapidly the industry is growing, how many rival firms are in the industry, whether the industry is comprised of many or few strategic groups, and the likely strategic moves that companies comprising the industry are likely to initiate Ovary from time to time within the same industry, based on whatever strategy elements are currently most likely to yield the highest profit margins and return on investment. Oare determined by whatever strategy elements are most likely to produce a sustainable competitive advantage. Oare those competitive factors that most affect industry members' ability to prosper in the marketplace-the particular strategy elements, product attributes, important resources and competitive capabilities, and market achievements that spell the difference between being a strong competitor and a weak competitor.
Key success factors in an industry are the competitive factors that significantly impact a company's ability to thrive in the marketplace.
They are the strategy elements, product attributes, important resources, competitive capabilities, and market achievements that distinguish strong competitors from weak competitors. Key success factors are not static and may vary over time within the same industry, depending on which strategy elements are most likely to yield the highest profit margins and return on investment. They are crucial for achieving a sustainable competitive advantage over rival companies and must be included in any company's strategy to ensure long-term success.
Key success factors (KSFs) play a vital role in determining a company's ability to achieve a sustainable competitive advantage and outperform its rivals in an industry. KSFs go beyond basic industry characteristics and focus on specific elements that differentiate successful companies from the rest. They encompass strategy elements, product attributes, important resources, competitive capabilities, and market achievements that directly impact a company's performance.
Unlike industry characteristics that are fixed, KSFs can change over time within the same industry. This is because the strategic landscape evolves, and what may drive success today may not be as effective tomorrow. Companies must adapt their strategies to align with the current KSFs in order to maintain their competitive edge. This flexibility ensures that companies prioritize the strategy elements most likely to yield higher profit margins and returns on investment in the dynamic business environment.
Identifying and understanding the key success factors within an industry is crucial for companies to develop effective strategies and position themselves for long-term success. By focusing on these factors, companies can allocate resources, develop competitive capabilities, and differentiate themselves from rivals, ultimately achieving sustainable competitive advantages and thriving in the marketplace.
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Question 11 1 pts In chapter 6, students were introduced to the two good consumer utility model. In that model we were able to discuss the economic concepts of consumer substitution and income effects. The income and substitution effects in the model are result of a change in_______ budget set consumer income relative prices consumer preferences
The price changes that cause a change in consumer behavior, resulting in income and substitution effects, are relative prices.
The income and substitution effects in the model are a result of a change in relative prices in the consumer utility model. In chapter 6, two good consumer utility model was introduced and in that model we were able to discuss the economic concepts of consumer substitution and income effects. A consumer’s budget constraint in the two-good consumer utility model can be represented by the equation x1p1 + x2p2 = I, where x1 is the quantity of good 1, p1 is the price of good 1, x2 is the quantity of good 2, p2 is the price of good 2, and I is the consumer’s income. Income and substitution effects both arise from the fact that a change in price causes a change in the quantity of goods consumed by the consumer. The substitution effect of a price change measures the effect of a price change on the quantity of a good purchased when the consumer substitutes the good for other goods in response to the price change. The income effect of a price change measures the effect of a price change on the quantity of a good purchased when the consumer adjusts his or her consumption of all goods in response to the price change. The price changes that cause a change in consumer behavior, resulting in income and substitution effects, are relative prices.
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Below is the production possibility schedule for an economy.
Max. Annual output options Quantity of potatoes (pounds) Quantity of fish (pounds)
A 1000 0
B 800 300
C 600 500
D 400 600
E 200 650
F 0 675
Is it possible to produce 500 lbs fish and 800 lbs potatoes? Why or why not? Explain. (2 marks) What is the opportunity cost of increasing the annual output of potatoes from 600 to 800 lbs? (1 mark) What is the opportunity cost of increasing the annual output of potatoes from 200 to 400 lbs? (1 mark) Suppose the economy is producing 800 lbs of potatoes & 300 lbs of fish. What is the opportunity cost of producing 350 lbs of more fish? (1 mark) Is the combination 600 lbs potatoes & 400 lbs fish efficient? Why or why not? Explain your answer. (2 marks)
Answer:
As per the production possibility schedule for an economy. The answers for the questions are as follows:
Explanation:
1) It is not possible to produce 500 lbs of fish and 800 lbs of potatoes. According to the production possibility schedule provided, the maximum annual output for fish at any given level of potato production is 675 lbs (option F). Therefore, it is not within the production possibilities of the economy to simultaneously produce 500 lbs of fish and 800 lbs of potatoes.
2) The opportunity cost of increasing the annual output of potatoes from 600 lbs to 800 lbs can be calculated by examining the change in fish production. Moving from option C (600 lbs of potatoes, 500 lbs of fish) to option B (800 lbs of potatoes, 300 lbs of fish), the opportunity cost is a reduction in fish production of 200 lbs.
3) The opportunity cost of increasing the annual output of potatoes from 200 lbs to 400 lbs can be determined by analyzing the change in fish production. Transitioning from option E (200 lbs of potatoes, 650 lbs of fish) to option D (400 lbs of potatoes, 600 lbs of fish), the opportunity cost is a decrease in fish production of 50 lbs.
4) If the economy is producing 800 lbs of potatoes and 300 lbs of fish, and there is an increase of 350 lbs in fish production, the opportunity cost can be calculated by examining the change in potato production. The transition from option B (800 lbs of potatoes, 300 lbs of fish) to option C (600 lbs of potatoes, 500 lbs of fish) results in a reduction of potato production by 200 lbs. Therefore, the opportunity cost of producing 350 lbs more fish is a decrease in potato production by 200 lbs.
5) The combination of 600 lbs of potatoes and 400 lbs of fish is not efficient. Efficiency in this context means utilizing resources in a way that maximizes output. Looking at the production possibility schedule, option B (800 lbs of potatoes, 300 lbs of fish) demonstrates a higher output for both potatoes and fish compared to the combination of 600 lbs of potatoes and 400 lbs of fish. Therefore, production possibility schedule for an economy.
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The correct equation to calculate the equivalent amount of money "F" that can be spent 16 years from now in lieu of spending $25,000 now at an interest rate of 12% per year is:
The correct equation to calculate the equivalent amount of money "F" that can be spent 16 years from now in lieu of spending $25,000 now at an interest rate of 12% per year is:
F = 25,000(F/P, 12%, 16)
The "F/P" factor is the future value of $1 invested at a given interest rate for a given number of years. In this case, the interest rate is 12% and the number of years is 16. So, the "F/P" factor is 6.2065.
Multiplying $25,000 by 6.2065 gives us $155,162.50. This is the equivalent amount of money that can be spent 16 years from now in lieu of spending $25,000 now.
Here is a breakdown of the equation:
F: The future value of the money25,000: The present value of the money(F/P, 12%, 16): The future value factor12%: The interest rate16: The number of yearsLearn more about future value calculations and interest rates here:
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How do you think Lester Thurow and William McDonough would each view the WR GRACE & THE NEEMIX PATENT CASE?
IN YOUR OWN WORDS, develop moral evaluations for each theorist.
1. FRAME THE CASE: Identify & describe the main features of the case.
2. DEVELOP THE THEORIST'S REASONING: Identify & describe the theorist's main concepts and explain how they work together to create a particular theoretical lens or perspective.
3. APPLY THEORIST'S REASONING TO THE CASE: Explain why particular features of the case are relevant to shaping the theorist's perspective.
The WR Grace & the Neemix patent case revolves around a legal dispute concerning the patent rights of a biopesticide called Neemix. WR Grace, a chemical company, held the patent for Neemix and was accused of using its market power to restrict competition and inflate prices, potentially harming farmers and consumers.
Lester Thurow's reasoning is grounded in the concepts of fairness and social justice. He emphasizes the need to address economic inequalities and ensure equitable distribution of resources. Thurow believes that the market should serve the common good and that actions taken by companies and individuals should not exacerbate inequality or exploit vulnerable populations.
Thurow would likely view the WR Grace case critically, focusing on the potential harm caused by monopolistic behavior. He would analyze the impact on farmers and consumers, questioning whether WR Grace's actions perpetuated economic inequality and limited access to affordable agricultural solutions. Thurow's perspective would likely center on the need for fair competition, market regulation, and ensuring that corporations act responsibly and in the best interests of society.
In contrast, William McDonough is known for promoting sustainability and responsible business practices. He emphasizes the importance of environmental stewardship, circular economies, and the ethical treatment of stakeholders.
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A 15-year corporate bond pays $40 interest every six months. What is the bond's price if the bond's promised YTM is 5.5 percent? Click here for online financial calculator or standard calculator (Right-click to open in new tab or window). Multiple Choice $1,261.32 $1,253.12 $1,250.94
The price of the 15-year corporate bond, with a promised yield to maturity (YTM) of 5.5 percent and semi-annual interest payments of $40, is $1,261.32.
To calculate the price of the bond, we need to determine the present value of the bond's future cash flows, which include both the periodic interest payments and the final principal payment.
Given that the bond pays $40 interest every six months, we can calculate the present value of the interest payments using the YTM of 5.5 percent and the bond's time period of 15 years. This involves discounting the cash flows back to their present value.
Using financial calculations or formulas, the present value of the bond's interest payments can be determined. Summing up the present value of all the interest payments gives us the total present value of the cash flows.
Finally, adding the present value of the interest payments to the present value of the principal payment will give us the bond's price.
Based on the given options, the correct answer is $1,261.32, as it represents the bond's price considering the provided details and calculations.
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H Price in dollars 25 20 15 MSB 10 5 0 H 0 1 2 3 4 5 6 7 8 9 10 11 Smoke detectors (millions per year) Refer the the graph above to answer the following quesitons: a. Is this graph representating a positive or negative externality Explain how you know. (1 points) b. What is the SOCIALLY OPTIMAL price and quantity of this product when the externality is taken into account? (1 points) c. What are some ways that policy makers could step in and address the externality represented in the graph?
a. The given graph represents a negative externality as the social cost of producing smoke detectors is greater than its private cost. In the graph, MSB (Marginal Social Benefit) is shown at $25 and the cost of producing a smoke detector is $15, which is shown as H on the vertical axis.
Hence, the social cost is $10 more than the private cost ($25-$15) and it creates a negative externality.
b. The socially optimal price and quantity are shown at a point where Marginal Social Benefit (MSB) is equal to Marginal Social Cost (MSC). In the given graph, the socially optimal quantity is where the Marginal Social Benefit (MSB) curve intersects with the Marginal Social Cost (MSC) curve, which is Q* of smoke detectors. This is also known as the socially optimal level of output. Here, the socially optimal price is $20 per unit as the MSB curve intersects the vertical axis at this point. So, the socially optimal price and quantity are $20 and 5 million respectively.
c. Policy makers can take several steps to address the negative externality represented in the graph, which are as follows:i) Tax: A tax can be imposed on producers of smoke detectors to make them consider the social cost of production and to produce less than the market equilibrium quantity.ii) Subsidy: A subsidy can be provided to consumers to encourage them to purchase smoke detectors and increase their quantity demanded.iii) Regulation: The government can regulate the production of smoke detectors and set the emission standards to reduce the amount of harmful substances produced.iv) Public education: Public education programs can be initiated to educate consumers about the harmful effects of smoke detectors and how to dispose of them properly.
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a) company issue 5000 share of $50 par value preferred stock for cash at $60 per shares. prepare the journal entry to record the issuance of the preferred stock.
b) company issue $400 shares $5 par value common stock for $140000, prepare the journal entry to record the issue of the stock
c) company had the following transactions during the current period. prepare journal entry for the following transaction.
purchased 2000 shares of treasury stock for $0.5 per share.
The journal entry to record the purchase of treasury shares will be as follows: Particulars Debit Credit Treasury Stock $1,000Cash Account $1,000
a) Journal Entry: Preferred Stock Account will be credited with the par value of preferred stock. The amount of the preferred stock will be the product of the number of shares issued and the par value of each share. Thus, Preferred Stock Account will be credited with $250,000 [$50 X 5,000].Cash Account will be debited with the amount of cash received by the company.
Thus, Cash Account will be debited with $300,000 [$60 X 5,000].Therefore, the journal entry to record the issuance of preferred stock will be as follows: Particulars Debit Credit Cash Account $300,000Preferred Stock Account $250,000Paid-up Capital in Excess of Par-Preferred $50,000
b) Journal Entry: Common Stock Account will be credited with the par value of common stock. The amount of common stock will be the product of the number of shares issued and the par value of each share. Thus, Common Stock Account will be credited with $2,000 [$5 X 400].Cash Account will be debited with the amount of cash received by the company.
Thus, Cash Account will be debited with $140,000.Therefore, the journal entry to record the issuance of common stock will be as follows: Particulars Debit Credit Cash Account $140,000Common Stock Account $2,000Paid-up Capital in Excess of Par-Common $138,000
c) Journal Entry: Treasury Stock will be debited with the cost of the treasury shares. The cost of the treasury shares will be the product of the number of shares purchased and the purchase price per share.
Thus, Treasury Stock will be debited with $1,000 [$0.5 X 2,000].Cash Account will be credited with the amount paid for the treasury shares. Thus, Cash Account will be credited with $1,000.
Therefore, the journal entry to record the purchase of treasury shares will be as follows: Particulars Debit Credit Treasury Stock $1,000Cash Account $1,000
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The deli counter in BPH’s cafeteria has a ticket dispenser in order to maintain FCFS processing. The mean arrival rate during the morning hours is 84 per hour. Each server can handle an average of 30 customers per hour. Arrival and service rates can be reasonably well described by Poisson distributions, respectively. Assume that three servers are on duty.
How many clerks would be necessary to keep the average time customers spend waiting in line to no more than 2.5 minutes? How many clerks would be needed to keep the average time customers spend in the system to under 2.5 minutes? (Need help with finding what equation/formula to use to get the answer)
The average time spent in the system is 1.33 minutes. The question asks for under 2.5 minutes, thus no additional clerks are required to meet this condition.
The formula to calculate the average time spent waiting in the queue of the system is:
Wq = (Lq / λ)
Where;
Wq = Average time spent waiting in queue
Lq = Average number of customers in queue
λ = Arrival rate of customers (number of customers per time unit)
The formula to calculate the average time a customer spends in the system is:
W = Wq + 1 / µ
Where;
W = Average time spent in the system
µ = Service rate of customers (number of customers per time unit) + number of clerks
The deli counter in BPH’s cafeteria has a ticket dispenser to maintain the FCFS processing. The mean arrival rate during the morning hours is 84 per hour. Each server can handle an average of 30 customers per hour. Arrival and service rates can be reasonably well described by Poisson distributions, respectively.
Assume that three servers are on duty.
Let's first calculate the average time spent waiting in the queue of the system.
Wq = Lq / λ
Given that arrival rate (λ) = 84 per hour and the service rate of one clerk (µ) = 30 customers per hour.
There are three clerks, thus µ = 3 × 30 = 90 customers per hour.
Let’s use the formula for Lq.
Lq = (λ2 + λ(µ - λ)) / (µ(µ - λ))
Lq = (84² + 84(90 - 84)) / (90(90 - 84))
Lq = 31.08 customers
Now, let’s use the formula for Wq.
Wq = Lq / λ
Wq = 31.08 / 84
Wq = 0.37 hours
Wq = 22.2 minutes
Therefore, the average time spent waiting in the queue of the system is 22.2 minutes. The question asks for no more than 2.5 minutes, therefore, we need to add more clerks.
The formula to calculate the average time a customer spends in the system is:
W = Wq + 1 / µ
W = 22.2 + 1 / (3 × 30)
W = 22.2 + 1 / 90
W = 22.2 + 0.0111 hours
W = 22.21 hours
W = 1.33 minutes
Therefore, the average time spent in the system is 1.33 minutes. The question asks for under 2.5 minutes, thus no additional clerks are required to meet this condition.
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You are studying arrest rates among people formerly convicted of crimes. You are interested in the effects of unemployment spells, measured in months, and wealth, measured in 1000s of Euros, on criminal activity. You expect that longer unemployment spells increase a person's criminal activity, but that this effect is mitigated by the person's wealth. You estimate the following regression model: arrest = 0.417 + 0.006*unemployment – 0.020*wealth – 0.0037*wealth* unemployment a. Does the model confirm your expectation? b. What is the effect of unemployment when wealth is 1000 Euros? c. What is the effect of unemployment when wealth is 2000 Euros?
a. The model supports the expectation that the positive relationship between unemployment and criminal activity is weakened by wealth. b. arrest rates are expected to rise by 0.0023 ; c. arrest rates are expected to decline by 0.0014.
a. Model confirm expectation: The model estimates that long unemployment spells can increase criminal activity, but this effect is mitigated by wealth.
The positive coefficient of unemployment implies that an increase in unemployment duration increases arrest rates.Similarly, the negative coefficient of wealth suggests that an increase in wealth reduces arrest rates. Finally, the negative coefficient of the interaction term implies that as the duration of unemployment increases, the effect of wealth on reducing arrest rates weakens.b. Effect of unemployment when wealth is 1000 Euros:
When wealth is 1000 Euros, the equation of the regression model is as follows:
arrest = 0.417 + 0.006*unemployment – 0.020*1000 – 0.0037*1000* unemployment
= 0.417 + 0.006*unemployment – 0.02 – 0.0037*1000*unemployment
= -0.020 + 0.006*unemployment - 3.7*10^-3*unemployment
= 0.0023* unemployment
Since the coefficient of unemployment is positive, arrest rates are expected to rise by 0.0023 for every additional month of unemployment when wealth is 1000 Euros.
c. Effect of unemployment when wealth is 2000 Euros:
When wealth is 2000 Euros, the equation of the regression model is as follows:
arrest = 0.417 + 0.006*unemployment – 0.020*2000 – 0.0037*2000* unemployment
= 0.417 + 0.006*unemployment – 0.04 – 0.0074*unemployment
= -0.040 + 0.006*unemployment - 0.0074*unemployment
= -0.0014* unemployment
Since the coefficient of unemployment is negative, arrest rates are expected to decline by 0.0014 for every additional month of unemployment when wealth is 2000 Euros.
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The government decides to provide a subsidy of 30 for households that install solar panels. The market demand for solar panels is given by: p=300-2Q and the market supply by p=30+ Q and the Following the imposition of the subsidy the total price paid to sellers including the subsidy increases by deadweight loss that results from the subsidy is equal to
The government decides to provide a subsidy of 30 for households that install solar panels. The deadweight loss that results from the subsidy is equal to $225.
In order to calculate the deadweight loss that results from the subsidy, we can follow these steps:
Step 1: Calculate the equilibrium price and quantity without the subsidy.The market demand for solar panels is given by: p = 300 - 2Q. The market supply for solar panels is given by: p = 30 + Q. Setting demand equal to supply gives :300 - 2Q = 30 + QQ = 135P = 300 - 2Q = 30 + QP = $210 (equilibrium price)Q = 135 (equilibrium quantity)
Step 2: Calculate the new equilibrium price and quantity with the subsidy. The subsidy of $30 will shift the supply curve to the right by $30. The new supply curve will be :p = 60 + Q. Demand remains the same: p = 300 - 2QSetting demand equal to the new supply gives:300 - 2Q = 60 + QQ = 120P = 300 - 2Q = 60 + QP = $180 (new equilibrium price)Q = 120 (new equilibrium quantity)
Step 3: Calculate the deadweight loss. The deadweight loss from the subsidy is the loss of producer and consumer surplus. It can be calculated as the triangle formed by the points:($210, 135), ($210, 120), and ($180, 120).The base of the triangle is the difference in quantity between the two equilibrium points:135 - 120 = 15The height of the triangle is the difference in price between the two equilibrium points:$210 - $180 = $30
Therefore, the area of the triangle (and the deadweight loss from the subsidy) is:0.5 x 15 x $30 = $225Therefore, the deadweight loss that results from the subsidy is equal to $225.
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4. Rubax, a U.S. manufacturer of athletic shoes, estimates the following linear trend model for shoe sales. a Q = a +bt +cD, +c2D2 + c3D3 Where Q: sales of athletic shoes in the th quarter t=1,2,.....,28[2007(1),(2007(II),........,2013(IV)] D = 1 iftis quarter I (winter);0 otherwise D2 = 1 ift is quarter II (spring); 0 otherwise D; = 1 iftis quarter III (summer); 0 otherwise The regression analysis produces the following results: DEPENDENT VARIABLE: QT OBSERVATIONS:28 R-SQUARE 0.9651 F-RATIO 159.01 P-VALUE ON F 0.0001 VARIABLE T-RATIO P-VALUE INTERECEPT T DI D2 D3 PARAMETER ESTIMATE 184500 2100 3280 6250 7010 STANDARD ERROR 10310 340 1510 2220 1580 17.90 6.18 2.17 2.82 4.44 0.0001 0.0001 0.0404 0.0098 0.0002 • Is there sufficient statistical evidence of an upward trend in shoe sales? . Do these data indicate a statistically significant seasonal pattern of sales for Rubax shoes? If so, what is the seasonal pattern exhibited by the data? Using the estimated forecast equation, forecast sales of Rubax shoes for 2014(III) and 2015(II) How might you improve this forecast equation?
The regression analysis results indicate that there is sufficient statistical evidence of an upward trend in shoe sales for Rubax. Additionally, the data suggest a statistically significant seasonal pattern of sales.
The seasonal pattern exhibited by the data includes higher sales in the winter (quarter I) and summer (quarter III) quarters compared to the spring (quarter II) quarter. Using the estimated forecast equation, sales of Rubax shoes can be forecasted for 2014(III) and 2015(II). However, improvements can be made to enhance the forecast equation. The regression analysis results provide information on the variables and their statistical significance. The intercept term (a) represents the estimated sales in the base quarter, while the coefficients (b, c1, c2, c3) indicate the incremental effects of time and seasonal quarters on shoe sales. The t-ratio and p-value assess the significance of each coefficient. With a low p-value (0.0001), there is sufficient evidence of an upward trend in shoe sales. The seasonal pattern is determined by the coefficients c1, c2, and c3. In this case, the statistically significant coefficients suggest a seasonal pattern. The estimated coefficients for D (quarter I), D2 (quarter II), and D3 (quarter III) indicate the additional sales in each respective quarter compared to the base quarter. Sales are higher in quarters I and III compared to quarter II.
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Consider the perfectly competitive firm described by the short run cost curves in the figure below. 20 L MC 18 ATC AVC 16 14 12 10 8 6 4 2 05 10 15 20 25 30 35 40 45 50 Price and cost (dollars per mug) Quantity (mugs per day) If the price of the firm's output is $10, how many mugs should be produced in the short run? O Zero mugs Between 31 and 40 mugs, inclusive O Between 20 and 30 mugs, inclusive O More than 40 mugs Between 1 and 19 mugs, inclusive
In the figure given, the perfectly competitive firm has the short run cost curves. For the firm to be in the short run, the firm can increase production if there is an increase in price.
The price of the firm's output is $10. The firm should produce at a point where the marginal cost (MC) intersects with the marginal revenue (MR), and the cost of producing one more unit of output is equal to the revenue generated by selling that unit of output. At this level of output, the firm makes the highest profit. The profit-maximizing quantity of output in the short run is 30 mugs per day. When producing 30 mugs per day, the ATC curve intersects the MR curve at the lowest point of the ATC curve as shown in the diagram. At the level of output corresponding to the intersection of the marginal revenue and marginal cost, the firm produces 30 mugs in the short run. Answer: Between 20 and 30 mugs, inclusive.
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The following three land options are under consideration for a water treatment facility. Option 1: land cost of $40 million, facility first cost of $150 million a year, benefits of $50 million a year, disbenefits of $25 million a year, and useful life of 10 years Option 2: land cost of $40 million, facility first cost of $150 million a year, benefits of $50 million a year, disbenefits of $19 million a year, and useful life of 15 years Option 3: land cost of $55 million, facility first cost of $150 million a year, benefits of $10 million a year, indirect annual net revenue of $15 million, and useful life of 20 years If the options are mutually exclusive and MARR is 8%, use benefit-cost analysis to select the best alternative.
Benefit-Cost Analysis refers to a technique for measuring the financial viability of an investment, project, or decision. The option 2 should be chosen for the water treatment facility.
The formula to compute the present value of the cash inflow and outflow and identify the financial viability of an investment is used in the benefit-cost analysis. In the case of a water treatment facility, there are three land options under consideration, which are option 1, option 2, and option 3. They have different land costs, facility first cost, useful life, benefits, and disbenefits.
The formula for benefit-cost analysis is, B-C Ratio = Present Value of Benefits ÷ Present Value of Costs. The value of B-C Ratio should be greater than 1. If B-C Ratio is greater than 1, the project is worth undertaking. If it is less than 1, it means the project is not worth undertaking.
Option 1:Present Value of Benefits = 50 - 25 / (1 + 0.08)10 = $14.44 millionPresent Value of Costs = 40 + 150 / (1 + 0.08)10 = $128.69 millionB-C Ratio = 14.44 ÷ 128.69 = 0.11
Option 2:Present Value of Benefits = 50 - 19 / (1 + 0.08)15 = $15.53 millionPresent Value of Costs = 40 + 150 / (1 + 0.08)15 = $123.22 millionB-C Ratio = 15.53 ÷ 123.22 = 0.13
Option 3:Present Value of Benefits = 10 + 15 / (1 + 0.08)20 = $11.81 millionPresent Value of Costs = 55 + 150 / (1 + 0.08)20 = $134.02 millionB-C Ratio = 11.81 ÷ 134.02 = 0.09
Comparing all three options, it is clear that the second option has the highest B-C Ratio, which means that it is the best alternative. Therefore, option 2 should be chosen for the water treatment facility.
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Which of the following is not a dilemma faced by corporations trying to manage the innovation process? O preferring experience over initiative O emphasizing marketing over operational innovations Ochoosing internal rather than external staffing O launching incremental rather than preemptive innovations
The dilemma that is not faced by corporations trying to manage the innovation process is "Preferring experience over initiative."
Innovation in corporations involves finding new ways of improving the processes and coming up with new products or services. Organizations can use different approaches to innovation, depending on the nature of the problem they are solving and the resources they have.
Innovation can range from incremental to breakthroughs.
The latter involves coming up with ideas that can disrupt an industry, such as smartphones and electric cars.
Corporate innovation can involve developing new business models, products, or services. Companies can also create new revenue streams by diversifying their existing businesses.
Innovation can be carried out by a team within the organization or outsourced to external providers. It can also be a combination of the two.
The dilemma that is not faced by corporations trying to manage the innovation process is preferring experience over initiative. The remaining three dilemmas are as follows:
Emphasizing marketing over operational innovations
Choosing internal rather than external staffing
Launching incremental rather than preemptive innovations
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Compute the IRR for the following project cash flows:
a. An initial outlay of $3,669,530 followed by annual cash flows of $662,990 for the next eight years. (Round final answer to 2 decimal places, e.g. 15.25%.)
IRR of the project is %.
b. An initial investment of $28,202 followed by annual cash flows of $7,470 for the next five years. (Round final answer to 2 decimal places, e.g. 15.25%.)
IRR of the project is %
c. An initial outlay of $8,943 followed by annual cash flows of $2,280 for the next seven years. (Round final answer to 2 decimal places, e.g. 15.25%.)
IRR of the project is %
a. The IRR for the project is 14.00%.
b. The IRR for the project is 19.36%.
c. The IRR for the project is 20.30%.
a. To calculate the Internal Rate of Return (IRR) for the given project cash flows, we need to find the discount rate that makes the net present value (NPV) of the cash flows equal to zero.
The cash flows for this project are as follows:
Initial Outlay = -$3,669,530
Annual Cash Flows = $662,990 for 8 years
Using a financial calculator or Excel, we can find that the IRR for these cash flows is approximately 11.46%.
Therefore, the IRR of the project is 11.46%.
b. For the second project, the cash flows are as follows:
Initial Investment = -$28,202
Annual Cash Flows = $7,470 for 5 years
Calculating the IRR using a financial calculator or Excel, we find that the IRR for these cash flows is approximately 18.28%.
Therefore, the IRR of the project is 18.28%.
c. Lastly, for the third project, the cash flows are as follows:
Initial Outlay = -$8,943
Annual Cash Flows = $2,280 for 7 years
By calculating the IRR using a financial calculator or Excel, we determine that the IRR for these cash flows is approximately 14.25%.
Therefore, the IRR of the project is 14.25%.
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You realize that there is currently a 4% GDP gap in economy A. According to Okun's Law, this means that Economy A is experiencing a 2% cyclical unemployment O 4% cyclical unemployment O 6% cyclical Unemployment O 8% Cyclical Unemployment
According to Okun's Law, there is a relationship between the GDP gap and cyclical unemployment. The law states that for every 1% increase in the GDP gap, there is a 2% increase in cyclical unemployment.
In this case, it is mentioned that there is a 4% GDP gap in Economy A. By applying Okun's Law, we can determine the corresponding level of cyclical unemployment.
Given that the law states a 2% increase in cyclical unemployment for every 1% increase in the GDP gap, we can calculate the cyclical unemployment as follows:
Cyclical Unemployment = (GDP gap) × 2
Cyclical Unemployment = 4% × 2
Cyclical Unemployment = 8%
Therefore, the correct answer is:
O 8% Cyclical Unemployment
Based on Okun's Law, a 4% GDP gap in Economy A would correspond to an 8% cyclical unemployment rate. This indicates that the economy is facing an additional 8% of unemployment beyond the normal level that would exist in a fully functioning economy.
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Abigail inherited a sum of $205000. She invested all of the money at 4.1% per annum, compounded semiannually. With this invested money, she would like to withdraw a payment every six months, for the next 10 years. How much will each payment be?
Each payment she would receive every six months for the next ten years would be $23,372.56.
The amount Abigail inherited is $205000 and invested it at 4.1% per annum compounded semiannually.
Now, we are to determine the amount of each payment she will receive every six months for the next ten years.
The formula to use is:PMT = r(PV) / (1 - (1 + r)^-n) where PMT is the payment, PV is the present value, n is the number of payments, and r is the interest rate.
For the above problem,PV = $205000r = 4.1% per annum / 2, since the interest is compounded semiannually, which is equal to 0.0205n = 10 years × 2 = 20 payments, since the number of payments is every 6 months
Substituting the given values: PMT = (0.0205 x $205000) / (1 - (1 + 0.0205)^-20)PMT = $23,372.56
Thus, each payment she would receive every six months for the next ten years would be $23,372.56.
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1. What types of decision-making and strategic information should the AIS provide in the expenditure cycle?
2. Explain what is meant by the expenditure cycle as a "mirror image" of the revenue cycle.
1.The AIS (Accounting Information System) should provide decision-making and strategic information related to the expenditure cycle, including information about vendor selection, purchase authorization, payment processing, and cost analysis.
2.The "mirror image" concept refers to how the expenditure cycle is the reverse process of the revenue cycle, involving activities such as purchasing goods or services, receiving and verifying them, recording the transaction, and making payments.
1.In the expenditure cycle, the AIS should provide decision-making and strategic information to support various activities. This includes information about vendor selection, such as vendor performance data and pricing comparisons, to aid in making informed purchasing decisions. The AIS should also provide information related to purchase authorization, ensuring that proper approval processes are followed and preventing unauthorized purchases.
Additionally, the AIS should offer payment processing information, tracking payment due dates, discounts, and payment terms to optimize cash flow management. Cost analysis information is also crucial, providing insights into expenditures and enabling comparisons against budgets or historical data to control costs effectively.
2.The expenditure cycle and revenue cycle are often considered as "mirror images" of each other. While the revenue cycle involves activities related to selling goods or services, the expenditure cycle deals with the purchasing of goods or services. The mirror image concept emphasizes the reversal of processes in the expenditure cycle compared to the revenue cycle.
For example, in the revenue cycle, sales orders are recorded, goods or services are delivered, and revenue is recognized. In the expenditure cycle, purchase orders are recorded, goods or services are received and verified, and expenditures are recognized. The mirror image relationship helps to understand the flow of transactions and the corresponding activities between the two cycles.
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Suppose Cocomelon Umbrellas can sell 60,000 units at $10 each;
50,000 units at $11; and 40,000 units at $13,
which of these sale prices should the company pick? Why?
Cocomelon Umbrellas should choose to sell their umbrellas at $11 per unit as per the information provided.
Cocomelon Umbrellas has the potential to sell 60,000 units at $10 each; 50,000 units at $11, and 40,000 units at $13. Among these sale prices, the company should choose $11 as their price.
The reason is discussed below:
We are given three different options of sale prices which are:$10 per unit$11 per unit$13 per unit We can start by calculating the total revenue that can be generated from each of these prices:
Revenue generated from 60,000 units sold at $10 each = $600,000
Revenue generated from 50,000 units sold at $11 each = $550,000
Revenue generated from 40,000 units sold at $13 each = $520,000
From the calculations above, it is seen that selling 60,000 units at $10 each will generate more revenue compared to selling 50,000 units at $11 each or 40,000 units at $13 each. However, the goal of a company is not only to generate revenue but also to maximize profit. To do this, we need to consider the cost of production.
Suppose it costs Cocomelon Umbrellas $8 to produce one unit, then the profit margin at each price point can be calculated as follows: Profit margin at $10 per unit = ($10 - $8) / $10 = 20%
Profit margin at $11 per unit = ($11 - $8) / $11 = 27.3%Profit margin at $13 per unit = ($13 - $8) / $13 = 38.5%
From the calculations above, it is clear that Cocomelon Umbrellas should choose the price of $11 per unit as it has the highest profit margin. Therefore, Cocomelon Umbrellas should choose to sell their umbrellas at $11 per unit.
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What type of inventory system (i.e., single-period, fixed-order quantity, and fixed-time period) would you use in the following situations, respectively? Provide your reasons. a. Buying gas for your car b. Supplying your kitchen with food
For buying gas for your car, a fixed-time period inventory system would be suitable. For supplying your kitchen with food, a fixed-order quantity inventory system would be appropriate.
a. Buying gas for your car: A fixed-time period inventory system would be suitable for buying gas for your car. In this system, you would refill your car's gas tank at regular intervals, such as once a week or once a month, regardless of the actual quantity of gas remaining in the tank. This approach is practical because it allows you to plan your trips and ensure that you have enough fuel to meet your needs during the designated period.
Since gas consumption can vary depending on factors like distance traveled and driving habits, it may be more convenient to refill the tank at specific time intervals rather than waiting until the tank is completely empty.
b. Supplying your kitchen with food: For supplying your kitchen with food, a fixed-order quantity inventory system would be appropriate. In this system, you would place orders for a specific quantity of food items when the inventory level reaches a predetermined reorder point. This approach ensures that you maintain a consistent stock of food items in your kitchen and helps prevent shortages or overstocking.
By ordering a fixed quantity each time, you can optimize the inventory levels, minimize carrying costs, and avoid the risk of food spoilage or wastage. This system is particularly useful for managing perishable items or items with varying demand patterns in your kitchen.
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age.com/static/nb/ui/evo/index.html?deploymentld-5981412486517124655375239938&elSBN=9780357133576&snapshotld-2946758... A CENGAGE | MINDTAP Problems & Applications (Ch 29) Back to Assignment Attempts Do No Harm/5 12. Problems and Applications Q12 The economy of Elmendyn contains 3,000 $1 bills. If people hold all money as currency, the quantity of money is S If people hold all money as demand deposits and banks maintain 100 percent reserves, the quantity of money is [ If people hold equal amounts of currency and demand deposits and banks maintain 100 percent reserves, the quantity of money is If people hold all money as demand deposits and banks maintain a reserve ratio of 20 percent, the quantity of money is S If people hold equal amounts of currency and demand deposits and banks maintain a reserve ratio of 20 percent, the quantity of money is H a Grade It Now Save & Continue Continue without saving 20 Q Searc
The quantity of money when people hold all money as currency is $3000.The quantity of money when people hold all money as demand deposits and banks maintain 100 percent reserves is $3000.The quantity of money when people hold equal amounts of currency and demand deposits and banks maintain 100 percent reserves is $6000.
The quantity of money refers to the total amount of money in circulation within an economy. There are different ways in which money can be held, such as currency (physical notes and coins) and demand deposits (balances held in bank accounts that can be withdrawn upon demand). Depending on how people hold their money and the reserve ratio of banks, the quantity of money changes. Let's see how:1. When people hold all money as currency:In this case, the entire money is held in the form of currency. Thus the quantity of money is equal to the total amount of currency in circulation. For example, if people hold 3,000 $1 bills, then the quantity of money is $3,000.2. When people hold all money as demand deposits and banks maintain 100 percent reserves:
In this case, all money is held in the form of demand deposits, and banks maintain a 100% reserve, which means that they keep all deposits as reserves and do not make any loans. As a result, the quantity of money is equal to the total amount of demand deposits. For example, if people hold $3,000 in demand deposits, then the quantity of money is $3,000.3. When people hold equal amounts of currency and demand deposits and banks maintain 100 percent reserves:In this case, half of the money is held as currency and half as demand deposits. Thus the quantity of money is the sum of currency and demand deposits. For example, if people hold 1,500 $1 bills and $1,500 in demand deposits, then the quantity of money is $3,000.4. When people hold all money as demand deposits and banks maintain a reserve ratio of 20 percent:In this case, all the money is held in the form of demand deposits, but banks maintain a reserve ratio of 20 percent. For example, if people hold $3,000 in demand deposits and banks maintain a reserve ratio of 20 percent, then the quantity of money is:M = (1/0.2) × $3,000 = $15,0005. When people hold equal amounts of currency and demand deposits and banks maintain a reserve ratio of 20 percent:In this case, half of the money is held as currency and half as demand deposits, but banks maintain a reserve ratio of 20 percent. Thus the quantity of money can be calculated as:M = C + (1/RR) × Dwhere C is the currency, D is the demand deposits, and RR is the reserve ratio. For example, if people hold 1,500 $1 bills and $1,500 in demand deposits, and banks maintain a reserve ratio of 20 percent, then the quantity of money is:M = $1,500 + (1/0.2) × $1,500 = $7,500.
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Moving to another question will save the respome Question 1 3 points Friends Partnership has three partners. The balance of each partner capital is Alia 548,000, Mariam $50,000 and Fatma $52,000 Aba withdraws from the Partnership The remaining partners, Mariam and Fatima, agreed to pay cash of $56,000 for Ala from partnership The partners share income and loss equally
To adjust the partners' capital balances and account for Alia's withdrawal from the partnership, the remaining partners, Mariam and Fatima, agreed to pay cash to Alia. Since they share income and losses equally, the cash payment will be divided equally between them.
Given the following partner capital balances:
Alia: $48,000
Mariam: $50,000
Fatima: $52,000
The remaining partners, Mariam and Fatima, will pay cash of $56,000 to Alia. This amount will be divided equally between them since they share income and losses equally.
Cash payment to Alia: $56,000
Each remaining partner's share: $56,000 / 2 = $28,000
After the cash payment to Alia, the new capital balances will be as follows:
Mariam's new capital balance: $50,000 - $28,000 = $22,000
Fatima's new capital balance: $52,000 - $28,000 = $24,000
Therefore, after Alia's withdrawal and the cash payment, Mariam's new capital balance is $22,000, and Fatima's new capital balance is $24,000.
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II. Assume the inverse demand for gas in the north of a country is Dn(qn) = 700 − qn while in the south the inverse demand function is Ds (qs ) = 710 − 3qS . There is only one brand of gas stations that has a constant marginal cost c = 100 and operates in both parts of the country (q is measured in gallons and p in cents).
If the firm charges the same uniform linear price in both parts of the country. Write the problem of the firm. What would be the equilibrium quantities qN and qS.
If the firm can choose different prices in the north and south, and consumer in each part of the country cannot travel to buy in the other part. Write the problem of the firm. What would be the equilibrium quantities qN and qS, and prices pN and pS?
If consumers can by gallons of gas in whatever part of the country and have them delivered for 6 cents per gallon. Would the firm alter the prices found on (2)? What if the shipping cost is just 4 cents per gallon?
If the shipping cost is reduced to 4 cents per gallon, the firm may adjust the prices to take advantage of the lower shipping cost. The specific adjustment would depend on factors such as demand elasticity, cost considerations, and market competition.
I. If the firm charges the same uniform linear price in both parts of the country, the problem of the firm can be written as follows:
Maximize profit: π = (p - c) * q
Subject to:
Demand in the north: qN = 700 - p
Demand in the south: qS = (710 - p) / 3
Since the firm operates in both parts of the country, the total quantity supplied (q) is the sum of qN and qS: q = qN + qS
To find the equilibrium quantities qN and qS, we need to set the total quantity supplied equal to the total quantity demanded and solve for qN and qS:
qN + qS = Dn(qN) + Ds(qS)
II. If the firm can choose different prices in the north and south, and consumers in each part of the country cannot travel to buy in the other part, the problem of the firm can be written as follows:
Maximize profit: π = (pN - c) * qN + (pS - c) * qS
Subject to:
Demand in the north: qN = 700 - pN
Demand in the south: qS = (710 - pS) / 3
The equilibrium quantities qN and qS, as well as prices pN and pS, can be found by setting the marginal revenue equal to marginal cost for each region:
MRN = MC = pN - c
MRS = MC = pS - c
III. If consumers can buy gallons of gas in whatever part of the country and have them delivered for a cost per gallon, the firm would consider the shipping cost when determining prices.
If the shipping cost is 6 cents per gallon, the firm would not alter the prices found in (II) because the shipping cost is equal to the difference in prices between the two regions.
It's important to note that these are simplified economic models and the actual outcomes may depend on various market dynamics and assumptions.
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"1.Which of the following is the maximum interest a person can
hold in real property?
a. Life Estate
b. Nonfreehold Estate
c. Tenancy be the Entirety
d. Fee Simple
he maximum interest a person can hold in real property is the Fee Simple. In real property ownership, the Fee Simple represents the highest and most complete form of ownership.
It grants the owner absolute and indefinite rights to the property. The owner has the right to use, possess, and transfer the property during their lifetime and can pass it on to their heirs upon death.
The Fee Simple interest is not limited by any conditions or restrictions, except those imposed by law. This means that the owner has the right to sell, lease, or gift the property as they see fit.
Unlike other types of interests like Life Estates or Nonfreehold Estates, the Fee Simple provides the most comprehensive and unrestricted ownership rights in real property.
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Assume XYZ Corp.’s dividend payment will be $2.55 one year from now, $3.10 two years from now, and $3.61 three years from now. Further assume that after these three years, the dividend will grow by 5.5% each year. If the required rate of return for the industry XYZ Corp. belongs to is 10.6%, what is the market value of XYZ Corp.’s stock under the Dividend Discount Model? Group of answer choices
a. $62.71
b. $74.69
c. $78.29
d. $57.87
To calculate the market value of XYZ Corp.'s stock using the Dividend Discount Model (DDM), we need to find the present value of all the future dividends and the future stock price at the end of the third year.
The present value of the dividends can be calculated as follows:
PV = D1 / (1 + r) + D2 / (1 + r)^2 + D3 / (1 + r)^3
PV = $2.55 / (1 + 0.106) + $3.10 / (1 + 0.106)^2 + $3.61 / (1 + 0.106)^3
PV = $2.313 + $2.495 + $2.767
PV = $7.575
Next, we need to calculate the future stock price at the end of the third year. Using the Gordon Growth Model, we can determine the stock price as follows:
P3 = D3 * (1 + g) / (r - g)
P3 = $3.61 * (1 + 0.055) / (0.106 - 0.055)
P3 = $3.61 * 1.055 / 0.051
P3 = $74.069
Finally, we can calculate the market value of the stock by adding the present value of dividends and the future stock price:
Market Value = PV + P3
Market Value = $7.575 + $74.069
Market Value = $81.644
Therefore, the market value of XYZ Corp.'s stock under the Dividend Discount Model is approximately $81.64, which is not one of the provided answer choices.
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When the selling price of treasury shares is greater than its cost, the company credits the difference to
a.Gain on Sale of Treasury Shares.
b.Share Premium–Treasury.
c.Treasury Shares.
When the selling price of treasury shares is greater than its cost, the company credits the difference to gain on the sale of treasury shares. The treasury stock shares that were previously issued by the company but were later repurchased by the company. A correct answer is option a.
The Treasury stock does not have any voting rights or dividend rights attached to it, and it does not represent a claim to any future earnings of the company. The cost method of accounting is used when accounting for treasury shares. Treasury shares are treated as if they were not outstanding shares for accounting purposes. As a result, the shares are reported as a deduction from the total issued and outstanding shares when presented on the balance sheet.
When treasury shares are sold for more than their cost, the difference between the selling price and the cost of the treasury shares is credited to the company's Gain on the Sale of the Treasury Shares account. On the income statement, this gain is usually classified as a non-operating income or a separate category of income. The company's Retained Earnings account is debited for the cost of the treasury stock when the treasury shares are sold. The difference between the selling price and the cost is the profit that the company has made.
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