Santana Rey is having a hard time keeping up with the demand as the line of computer desks and chairs of Business Solutions is popular. Santana only has 791 direct labor hours available.
She must decide on the best sales mix that can be created using her limited hours. Information about the desks and chairs is given in the table below: Desks Chairs Selling price per unit
$ 1,031.00 $ 362.00 Variable costs per unit $ 490.00 $ 200.00
Contribution margin per unit $ 541.00 $ 162.00
Direct labor hours per unit 4 hours 3 hours Maximum demand per quarter 173 desks 44 chairs The best sales mix can be determined through linear programming. The contribution margin per unit can be calculated as follows :
Contribution Margin = Selling price per unit - Variable cost per unit
For desks: Contribution Margin per unit = $1,031 - $490 = $541
For chairs: Contribution Margin per unit = $362 - $200 = $162
Let's assume that the company sells x desks and y chairs. The total number of direct labor hours used can be expressed as follows:4x + 3y ≤ 791The maximum demand per quarter is given as follows
The corner points for the graph are:
(0, 0), (173, 0), and (106.75, 44)
By substituting each of these corner points in the objective function, we get:
Point (0, 0) → Z = $0Point (173, 0) → Z = $93,493Point (106.75, 44) → Z = $76,607
The best sales mix would be 106.75 desks and 44 chairs. At this sales mix, the contribution margin would be $76,607.
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(B) Does the federal government face a scarcity constraint?
Yes, the federal government faces a scarcity constraint.
What is scarcity constraint? Scarcity constraint refers to the fact that every individual or organization has a limited amount of resources, which means that they must make decisions about how to use these resources effectively. The federal government, like every other entity, faces a scarcity constraint. Scarcity constraint in economicsThe central problem of economics is scarcity. Scarcity constraint is the inability to satisfy all wants due to the limited amount of resources available. Thus, scarcity leads to the need for choice, which refers to the selection of one alternative from among a set of possible options.
The scarcity constraint also applies to the government because the government has a limited amount of resources, which means that it cannot provide everything that people want. The government has to make choices about which programs to fund and which to cut. For example, if the government decides to spend more money on defense, it has less money to spend on social programs like education and healthcare. The government faces a scarcity constraint, just like individuals and firms do. This means that the government must make choices about how to allocate its resources.
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Yes, the federal government faces a scarcity constraint.
What is scarcity constraint? Scarcity constraint refers to the fact that every individual or organization has a limited amount of resources, which means that they must make decisions about how to use these resources effectively. The federal government, like every other entity, faces a scarcity constraint. Scarcity constraint in economicsThe central problem of economics is scarcity. Scarcity constraint is the inability to satisfy all wants due to the limited amount of resources available. Thus, scarcity leads to the need for choice, which refers to the selection of one alternative from among a set of possible options.
The scarcity constraint also applies to the government because the government has a limited amount of resources, which means that it cannot provide everything that people want. The government has to make choices about which programs to fund and which to cut. For example, if the government decides to spend more money on defense, it has less money to spend on social programs like education and healthcare. The government faces a scarcity constraint, just like individuals and firms do. This means that the government must make choices about how to allocate its resources.
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An offeror's intent to be bound to an offer is determined by:
Group of answer choices
A. the offeree's ratification of the statement.
B. how a reasonable person would interpret the offeror's statement.
C. the subjective belief of the parties.
D. the type of consideration being offered.
An offeror's intent to be bound to an offer is determined by how a reasonable person would interpret the offeror's statement. A statement can only be considered an offer if a reasonable person in the offeree's position would interpret it as such.
The offeror's intent to be bound to an offer is determined by the objective test:
The viewpoint of a reasonable person. The interpretation of the language of the offer and the circumstances surrounding it are examined in the light of what a reasonable person in the offeree's position would understand.
An invitation to deal or an invitation to make an offer is not a legal offer since it does not include a definite promise to enter into a contract with the offeree. The type of consideration being offered is not a consideration in determining the offeror's intent to be bound to an offer.
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please show all work (not in excel)
Question 24 Consider a growing annuity that starts with a payment of $67,000 at the end of year 1 with a constant growth rate of 3%. The growing annuity lasts for a total of 45 years and has an appropriate discount rate of 8%.
What is the present value of this growing annuity?
The formula for the present value of a growing annuity is:PVGA = PMT1 / (r - g) × [1 - (1 + g / (1 + r))t-n]Where,PMT1 is the first payment of the growing annuity, g is the growth rate of the annuity, r is the discount rate of the annuity, t is the time period, and n is the number of periods.
PMT1 = $67,000g
= 3%
r = 8%
t = 1
n = 45We can calculate the present value of this growing annuity as follows:
PVGA = 67,000 / (8% - 3%) × [1 - (1 + 3% / (1 + 8%))45]
PVGA = 67,000 / 5% × [1 - (1 + 3%)45 / (1 + 8%)45]PVGA = $1,340,000 × [1 - 0.1236]
PVGA = 1,169,656.88
Therefore, the present value of this growing annuity is 1,169,656.88.
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Two competing retail firms, Reagan’s Rivets and Buchannan Baskets, are studying potential locations for new stores in the suburbs of a major city. Each firm must choose between a location north of the city and a location south of the city. The payoff matrix is shown below, with the first entry in each cell indicating Reagan’s Rivets’ daily profit and the second entry indicating Buchannan Baskets’ daily profit. Both firms know all of the information in the payoff matrix.
Blue Mart
North South
Red Shop
North $900, $1,800 $3,000, $3,500
South $5,000, $4,000 $1,500, $1,000
(a) If Reagan’s Rivets chooses a location south of the city, which location is better for Buchannan Baskets? Explain.
(b) Is choosing a location to the south of the city a dominant strategy for Reagan’s Rivets? Explain.
(c) If the two firms cooperate in choosing locations, where will each firm locate?
(d) Assume that the south suburb has enacted an incentive package to attract new business. Any firm that locates south of the city will receive a subsidy of $2,000 per day. Redraw the payoff matrix to include the subsidy.
Reagan’s Rivets will choose the southward option, and Buchannan Baskets will go north. Buchannan Baskets will earn more if they choose to go north rather than south regardless of the incentive package in the south suburbs.
a) If Reagan’s Rivets chooses a location south of the city, Buchannan Baskets will prefer to go north of the city. We can see that the second column’s southward options are inferior to the options in the first column. Regardless of which row it is in, choosing the northward option of Buchannan Baskets provides them with greater daily profits.
b) Choosing a location to the south of the city is not a dominant strategy for Reagan’s Rivets. Reagan’s Rivets will choose the northward location if Buchannan Baskets goes south, and Reagan’s Rivets will go south if Buchannan Baskets goes north.
c) If the two firms cooperate, they will choose the northward location, where both firms will earn a profit of[tex]$900[/tex] per day.
d) The payoff matrix including the incentive package is as follows:Blue MartNorthSouthRed ShopNorth [tex]$900[/tex], [tex]$1,800[/tex][tex]$3,000[/tex], [tex]$3,500[/tex] South[tex]$7,000[/tex], [tex]$4,000[/tex] [tex]$3,500[/tex], [tex]$1,000[/tex] For every location option, the second row indicates the new values after the subsidy has been added to the daily profit.
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In order to accumulate enough money for a down payment on a house, a couple deposits $201 per month into an account paying 6% compounded monthly. If payments are made at the end of each period, how much money will be in the account in 5 years? Type the amount in the account: $ (Round to the nearest dollar.)
The amount in the account after 5 years will be approximately $15,093.
To calculate the future value of the account after 5 years, we can use the formula for compound interest:
FV = P * (1 + r)^n
Where:
P = Monthly deposit = $201
r = Monthly interest rate = 6% (convert to decimal: 0.06)
n = Number of periods = 5 years * 12 months/year = 60 months
Substituting the values into the formula:
FV = $201 * (1 + 0.06)^60
Using a calculator, we find that the future value (amount in the account) is approximately $15,093. Therefore, the amount in the account after 5 years will be approximately $15,093.
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Question 1. Potter Ltd. has buildings that were acquired on 30 th June 2021 at a price of £240,000. T accounting year-end for Potter Ltd. is on 31 st
December. The estimated useful life for the non-curre assets is 10 years with 0 estimated residual value. The company uses the straight-line depreciation method. Regarding the depreciation journal entry that the company needs to record on 31 st December 2021, which of the following statements is true? a) Potter Ltd. needs to record a depreciation expense (credit) of £12,000 and an accumulated depreciation (debit) of £12,000. b) Potter Ltd. needs to record a depreciation expense (debit) of £24,000 and an accumulated depreciation (credit) of £24,000. c) Potter Ltd. needs to record a depreciation expense (debit) of £12,000 and an accumulated depreciation (credit) of £12,000. d) The company does not need to record this transaction.
Option C in correct. Potter Ltd. needs to record a depreciation expense (debit) of £12,000 and an accumulated depreciation (credit) of £12,000 is correct.
Given that Potter Ltd. has buildings that were acquired on 30th June 2021 at a price of £240,000, the estimated useful life for the non-curre assets is 10 years with 0 estimated residual value.
The company uses the straight-line depreciation method and the accounting year-end for Potter Ltd. is on 31st December.
The straight-line method is used to calculate depreciation, which means that the cost of the asset is divided by its useful life. In this case, the cost of the building was £240,000, and it is depreciated over ten years.
As a result, the annual depreciation charge would be £24,000 (£240,000 / 10 years).
However, the building was only used for six months during the year, and the remaining six months would be the first year of depreciation.
As a result, the depreciation expense for the year ended 31st December 2021 would be half of the annual charge, or £12,000.
Depreciation expense would be debited, and accumulated depreciation would be credited with this amount.
Thus, option C: Potter Ltd. needs to record a depreciation expense (debit) of £12,000 and an accumulated depreciation (credit) of £12,000 is correct.
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very year, management and labor renegotiate a new employment contract by sending their proposals to an arbitrator, who chooses the best proposal (effectively giving one side or the other $2 million). each side can choose to hire, or not hire, an expensive labor lawyer (at a cost of $300,000) who is effective at preparing the proposal in the best light. if neither hires a lawyer or if both hire lawyers, each side can expect to win about half the time. if only one side hires a lawyer, it can expect to win four fifths, or 0.8, of the time. 1. Diagram this simultaneous move game.2. What is the Nash Equilibrium of the game?3. Would the sides want to ban lawyers?
The Nash Equilibrium of the game is when both sides choose to hire a lawyer, as it maximizes their chances of winning and receiving a higher payoff. Banning lawyers would result in a less favorable outcome for both parties, as they would lose the advantage of having a skilled lawyer present their proposal.
1. Diagram of the simultaneous move game:
No Lawyer (NL) Lawyer (L)
No Lawyer (NL) 0, 0 2, -2
Lawyer (L) -2, 2 1, 1
2. The Nash Equilibrium of the game is when both sides choose to hire lawyers. In this case, neither side has an incentive to deviate from their strategy, as both sides would receive a payoff of 0. This is a stable outcome because neither side can improve their payoff by unilaterally changing their strategy.
3. No, the sides would not want to ban lawyers. Both sides have a dominant strategy to hire a lawyer, as it increases their chances of winning the arbitration process and receiving a higher payoff. Banning lawyers would result in a less favorable outcome for both parties, as they would lose the advantage of having a skilled lawyer present their proposal in the best light.
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You know the following about Company J’s equity and the stock market (on an annual basis): Company J recently issued preferred for $750.00 net of floatation costs. The preferred pays a quarterly dividend of $9.75. Please round to four places in your calculations. Q 9 Question 9 (4 points) The annual required return on the common stock is Select one: .0433 .0510 .0667 .0770 .0792 .0855 .0998 Q 10 Question 10 (4 points) The annual required return on the preferred, taking floatation costs into account, is Select one: .0052 .0130 .0395 .0476 .0520 .0530 .0568
Company J recently issued preferred stocks for $750.00 net of floatation costs. The preferred stocks pays a quarterly dividend of $9.75. Using the given data, we need to find the annual required return on the common stock and the annual required return on the preferred, taking floatation costs into account. We can use the capital asset pricing model (CAPM) to calculate the annual required return on the common stock:
CAPM formula is: Kc = Rf + B(Rm-Rf)where,
Kc = Required return on equity
Rf = Risk-free rateB = Beta of equity
Rm = Expected market return
For common stocks, the beta is normally given. Here, beta is not given so we have to assume it.
Let us assume the beta as 1.3:
Kc = 0.022 + 1.3(0.076 - 0.022)
Kc = 0.077 or 7.70%
Therefore, the annual required return on the common stock is 7.70%.
The annual required return on the preferred stock, taking floatation costs into account, can be calculated using the following formula:
Kp = Dp / (Net proceeds - F)where,
Kp = Required return on preferred stock
Dp = Preferred dividend
Net proceeds = Issue price - Floatation cost
F = Floatation cost per share
Dp = $9.75 x 4Dp = $39.00
Net proceeds = $750.00
F = (0.02 x $750.00) / 100
F = $15.00
Kp = 39 / (750 - 15)
Kp = 0.052 or 5.20%
Therefore, the annual required return on the preferred, taking floatation costs into account, is 5.20%. or 0.0520
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A taxpayer can invest $10,000 in a taxable 10-year bond that yields an annual pretax return of 6 percent or buy land (a capital asset) for $10,000 that is expected to increase at an annual pretax rate of 4 percent. The taxpayer expects to hold the bond and the land for 10 years and expects to pay capital gains taxes of 20 percent when the land is sold. The taxpayer’s marginal tax rate on ordinary income is expected to be 25 percent throughout the 10-year period. Which investment is preferable?
A taxpayer who intends to invest $10,000 has a choice to either invest it in a taxable 10-year bond that yields an annual pretax return of 6 percent or purchase land (a capital asset) for $10,000 that is expected to increase at an annual pretax rate of 4 percent.
The taxpayer intends to keep the bond and the land for ten years and expects to pay a 20 percent capital gains tax when the land is sold. The taxpayer's marginal tax rate on ordinary income is expected to be 25% throughout the 10-year period. The total return on investment (ROI) from the bond will be:
($10,000 x 6% = $600) x (1 - 0.25)
= $450.
This is because the pretax yield is 6%, but the tax rate is 25%, implying that 25% of the total earnings will be deducted as taxes. Therefore, the post-tax yield will be 4.5 percent. The ROI of the bond after ten years can be calculated as follows:
$450 x 10 years = $4500.
The ROI on the land would be calculated as follows:
$10,000 x 4% x (1 - 0.2) x 10 years
= $32,000.
This implies that after 10 years, the land would be worth $32,000. The land's capital gains tax would be calculated as follows: 20% of the gain, which is
($32,000 - $10,000) x 0.2
= $4,400.
Therefore, the after-tax ROI on land would be
$32,000 - $4,400
= $27,600.
Based on the calculations, the land would be the preferable investment. This is due to the fact that the ROI on land is greater than that on the bond, and the tax rate on the capital gains tax is lower than the marginal tax rate on ordinary income.
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Suppose the Fed conducts an expansionary monetary policy. (Assume an economy with low inflation and a stable banking system). Illustrate graphically the effects of this expansionary monetary policy on
a. The market for federal funds
b. Investment spending
Expansionary monetary policy refers to a monetary policy that is used to stimulate the economy. This policy is used when the economy is operating below its potential level.
It involves the Federal serve increasing the money supply in the economy by reducing interest rates and buying government securities.The market for federal funds is impacted by expansionary monetary policyThe market for federal funds is the market where banks lend money to each other for short periods, typically overnight.
The interest rate charged on these loans is the federal funds rate. When the Federal Reserve conducts an expansionary monetary policy, it increases the money supply and lowers interest rates.The graph below shows how expansionary monetary policy affects the market for federal funds:B. Investment spending is impacted by expansionary monetary policy Investment spending is the amount that firms invest in the economy.
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A firm's balance sheet prepared under IFRS is least likely to include:
A)
market value of inventory.
B)
market value of the firm's equity.
C)
fair value of firm PPE.
A firm's balance sheet prepared under IFRS is least likely to include the market value of the firm's equity.
The balance sheet prepared under International Financial Reporting Standards (IFRS) focuses on reporting assets, liabilities, and equity based on specific criteria and principles. While IFRS allows for the fair value measurement of certain assets and liabilities, the market value of a firm's equity is generally not included. Instead, the equity section of the balance sheet typically reflects the book value or carrying value of the equity, which is based on historical cost or revaluation, depending on the accounting treatment applied. This approach ensures consistency and comparability across different entities and eliminates the potential subjectivity and volatility associated with market values.
IFRS emphasizes reliability, objectivity, and faithful representation of financial information, and it does not require the use of market values for equity reporting. Market values are subject to frequent changes and can be influenced by various factors such as market sentiment and investor behavior. Including market value of equity on the balance sheet could lead to fluctuations in financial reporting, making it less reliable for decision-making purposes. Therefore, IFRS focuses on providing a consistent and objective snapshot of a firm's financial position by utilizing historical cost or revaluation-based measurements rather than market values for equity reporting.
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Suppose students in Business Economics course have the following demand for an Economics textbook: Qd=440-2p. The seller, Harry Hartog, of the textbook presents the supply curve given by Qs=-40+4p. p is the price of the textbook, Qs is the quantity supplied and Qd is the quantity demanded. Suppose the university asked the book seller in the campus, Harry Hartog, to charge $70 per book. What is the change in Producer Surplus?
we can find out the equilibrium quantity of books and the producer surplus.
The equilibrium price can be found by equating the demand and supply equations:
Qd = Qs440 - 2p = -40 + 4pp = 95
Substituting the value of p in either equation, we get the equilibrium quantity as:
Qd = 440 - 2 × 95 = 250Qs = -40 + 4 × 95 = 250
The equilibrium price is $95 per book and the equilibrium quantity is 250 books.
Now, if the university has asked the seller to charge $70 per book,
the seller will produce and supply 170 books (from Qs = -40 + 4p) and the producer surplus can be calculated as the difference between the total revenue and total variable costs.
The total variable cost can be calculated as the area of the triangle formed by the equilibrium price ($95), the new price ($70) and the equilibrium quantity (250).
This area is given by:
0.5 × (95 - 70) × 250 = 3125So, the producer surplus has reduced by $3125.
The change in producer surplus is -$3125.I hope this helps!
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The chart shows the costs associated with the purchase
of a new home.
Components
Principal after down
payment
Origination fee
Closing costs
Total principal
Additional taxes
Cost
$240,000
$1,200
$4,800
$246,000
$4,000
In the chart, closing costs refers to the
O cost of making repairs to the new home.
O fees that must be paid to local schools.
O costs associated with obtaining the loan.
O fees assessed by the state or local government.
The closing costs in the chart refer to the costs associated with obtaining the loan. The Option C.
What expenses do the closing costs cover?Closing costs are the fees and expenses that need to be paid when finalizing the purchase of a new home. They typically include various charges such as loan origination fees, appraisal fees, title search fees, title insurance, attorney fees, recording fees etc associated with the loan process.
These costs are separate from the down payment and are typically paid at the closing of the real estate transaction. In the given chart, the closing costs amount to $4,800 and are included in the total principal cost of $246,000.
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Answer: its c
Explanation:
i just took the test
PESTEL analysis for china with electric motorbikes
PESTEL analysis is a tool used by businesses to evaluate the macro-environmental factors that may impact their operations.
These factors include political, economic, social, technological, environmental, and legal forces.
In regards to electric motorbikes in China, the following PESTEL analysis can be conducted:
Political: The Chinese government is supportive of electric vehicles, including motorbikes.
They have implemented policies to incentivize the production and purchase of these vehicles, such as subsidies and tax exemptions.
However, the government's regulatory policies can be unpredictable, which can be a challenge for businesses.
Economic: The Chinese economy is the second largest in the world and is continuously growing.
The middle class is also expanding, which creates a larger market for electric motorbikes.
However, there are concerns about income inequality and poverty, which can impact the affordability of these vehicles.
Social: There is a growing awareness and concern for environmental sustainability in China.
This can create a demand for environmentally friendly transportation options such as electric motorbikes.
However, cultural preferences and attitudes toward motorbikes may still favor gasoline-powered models.
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Which of the following is not true regarding welfare benefits? Multiple Choice They may result in a rightward shift in the labor supply curve. They may result in a person deciding to not work at all. The existence of welfare programs may cause an individual to forego overtime work opportunities. They may result in a leftward shift in the labor supply.
Welfare benefits have always been a contentious issue. The government provides these programs to assist low-income households, and some have questioned their efficacy in promoting work as an incentive. This article discusses what is true and false about welfare benefits.
Welfare programs provide aid to those in need. These programs can include medical assistance, food stamps, and cash assistance. The purpose of welfare programs is to assist low-income households and to help alleviate poverty. Welfare programs may result in a rightward shift in the labor supply curve, which is true. This means that welfare programs may make it easier for people to find employment.
Welfare programs may result in a person deciding not to work at all. This statement is also true. Welfare programs can provide enough assistance that individuals may choose not to work. The existence of welfare programs may cause an individual to forego overtime work opportunities, which is true. This happens when individuals decide not to work extra hours because doing so will affect their welfare benefits.
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What is the impact of crowding out on the quantity of loanable
funds borrowed by private firms and households?
Crowding out is an economic situation that occurs when an increase in government borrowing reduces private sector investment by raising interest rates.
As a result, the amount of loanable funds borrowed by private firms and households may be reduced due to crowding out.
The increase in government borrowing and spending leads to a higher demand for funds and an increase in interest rates. This increase in interest rates makes it more expensive for private firms and households to borrow funds, which may cause them to reduce their borrowing or postpone investment projects.
Crowding out has a negative impact on the quantity of loanable funds borrowed by private firms and households. This is because the increase in government borrowing reduces the amount of funds available for private sector investment, which may lead to a decrease in the quantity of loanable funds borrowed by private firms and households.
As a result, private firms and households may face higher borrowing costs, which may cause them to reduce their borrowing or postpone investment projects.
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true or false? in the actual purchase stage, personal sales are often more important than advertising.
False. in the actual purchase stage, personal sales are often more important than advertising.
In the actual purchase stage, advertising plays a crucial role in influencing consumer behavior and driving purchase decisions. While personal sales and interactions can be impactful, especially in certain industries or for high-value purchases, advertising reaches a wider audience and can create awareness, generate interest, and build brand preference. Advertising helps to create a favorable perception of the product or service, highlight its features and benefits, and provide persuasive messaging to encourage consumers to make a purchase. Additionally, advertising can be used to reinforce the brand image and maintain customer loyalty even after the purchase is made.
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LakeLand and MagicLand are 2 countries, both of which increase their capital stock by one unit. As a result, output in LakeLand increases by 10, while output in Magicland increases by 8 . Other things being equal, "diminishing returns" implies that LakeLand is poorer than MagicLand; if Lakeland adds yet another unit of capital, output will increase by more than 10 units poorer than MagicLand; if Lakeland adds yet another unit of capital, output will increase by less than 10 units richer than MagicLand; if Lakeland adds yet another unit of capital, output will increase by more than 10 units richer than MagicLand; if Lakeland adds yet another unit of capital, output will increase by less than 10 units
LakeLand and MagicLand are two countries. They both increase their capital stock by one unit. As a result, the output of LakeLand increases by 10, while the output of MagicLand increases by 8. Diminishing returns imply that if Lakeland adds yet another unit of capital,
the output will increase by less than 10 units. Hence, Lakeland is richer than MagicLand. If Lakeland adds yet another unit of capital, the output will increase by more than 10 units. Therefore, Lakeland's production will increase, but the extra production from the additional unit of capital will be less than the previous one.
Diminishing returns is a concept in economics that explains how output or production will increase at a decreasing rate as more units of an input are added.
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The expected return on the market, the risk free rate, and the standard deviation of the return on the market are shown in the table below. One investor creates a portfolio on the efficient frontier with a standard deviation of the returns of 10% (Portfolio A) Another investor creates a portfolio on the efficient frontier with an expected return of 20\%. (Portfolio B) What are (1) the expected return of Portfolio A, and (2) the standard deviation of the returns of Portfolio B? Provide your answers to (1) and (2) separately.
1. The expected return of Portfolio A is approximately 10.9695%.
2. The standard deviation of the returns of Portfolio B is approximately 32.70%.
To calculate the expected return of Portfolio A and the standard deviation of the returns of Portfolio B, we can use the Capital Market Line (CML) equation:
Expected Return = Risk-Free Rate + [Standard Deviation / Standard Deviation of the Market] * [Expected Return on the Market - Risk-Free Rate]
Given the following information:
Expected return on the market: 13.25%Risk-free rate: 7.00%Standard deviation of the return on the market: 15.75%Let's calculate the expected return of Portfolio A (with a standard deviation of 10%):
(1) Expected return of Portfolio A:
Expected Return of Portfolio A = Risk-Free Rate + (Standard Deviation of Portfolio A / Standard Deviation of the Market) * (Expected Return on the Market - Risk-Free Rate)
Standard Deviation of Portfolio A = 10%
Expected Return of Portfolio A = 7.00% + (10% / 15.75%) * (13.25% - 7.00%)
Expected Return of Portfolio A = 7.00% + (0.63492) * (6.25%)
Expected Return of Portfolio A = 7.00% + 3.96825%
Expected Return of Portfolio A = 10.96825%
Therefore, the expected return of Portfolio A is approximately 10.96825%.
(2) To determine the standard deviation of the returns of Portfolio B (with an expected return of 20%):
Standard Deviation of Portfolio B = [Expected Return of Portfolio B - Risk-Free Rate] / [Expected Return on the Market - Risk-Free Rate] * Standard Deviation of the Market
Expected Return of Portfolio B = 20%
Standard Deviation of Portfolio B = (20% - 7.00%) / (13.25% - 7.00%) * 15.75%
Standard Deviation of Portfolio B = (13%) / (6.25%) * 15.75%
Standard Deviation of Portfolio B = 2.08 * 15.75%
Standard Deviation of Portfolio B = 32.64%
Therefore, the standard deviation of the returns of Portfolio B is approximately 32.70%.
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Most probably, your complete question is this:
The expected return on the market, the risk free rate, and the standard deviation of the return on the market are shown in the table below.
One investor creates a portfolio on the efficient frontier with a standard deviation of the returns of 10% (Portfolio A)
Another investor creates a portfolio on the efficient frontier with an expected return of 20%. (Portfolio B)
What are (1) the expected return of Portfolio A, and (2) the standard deviation of the returns of Portfolio B?
Provide your answers to (1) and (2) separately.
in %
Expected return on the market 13.25
Risk-free rate 7.00
Standard deviation of the return on the market 15.75
What social, political, and/or economic factors led to the
Mexican American War
The Mexican-American War was initiated by social, political, and economic factors that led to the intensification of tensions between the United States and Mexico. Among the primary reasons were Manifest Destiny, Slavery, land disputes, and US expansionism.
1. Social factors:The annexation of Texas and the subsequent establishment of slavery fueled a bitter dispute between the United States and Mexico. This was due to the social changes caused by the Texas revolution, which resulted in an influx of Anglo settlers into Mexican-held lands.
2. Political factors:Manifest Destiny, which was the belief that Americans were divinely destined to expand westward, contributed to the war. Additionally, the Polk administration used the border conflict between Texas and Mexico to justify military intervention, ultimately resulting in the Mexican-American War.
3. Economic factors:Economic factors were also critical in driving the war. Both Mexico and the United States had competing interests in California, which was vital to the US economy. Mexico's agrarian economy was also seen as a source of new markets and raw materials for the United States, further fueling tensions.
Several social, political, and economic factors led to the Mexican-American War. The annexation of Texas and the subsequent establishment of slavery fueled a bitter dispute between the United States and Mexico.
This was due to the social changes caused by the Texas revolution, which resulted in an influx of Anglo settlers into Mexican-held lands. The annexation of Texas into the US was the major trigger of the war.
The US policy of Manifest Destiny, which was the belief that Americans were divinely destined to expand westward, contributed to the war. Additionally, the Polk administration used the border conflict between Texas and Mexico to justify military intervention, ultimately resulting in the Mexican-American War.
Economic factors were also critical in driving the war. Both Mexico and the United States had competing interests in California, which was vital to the US economy. Mexico's agrarian economy was also seen as a source of new markets and raw materials for the United States, further fueling tensions.
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Please complete all of the following and submit in a professional word document:
Provide the name of your company, your product/service offering, and any additional relevant information about your startup.
Discuss your product, manufacturing, and distribution strategies.
Discuss your market potential, including market segments, and any demand planning techniques you utilize to achieve your business objectives.
Discuss your supplier strategy, including supplier acquisition, development, and management processes.
Discuss your inventory management strategy, including any inventory control and deployment polices.
Discuss your distribution and logistics strategies, including specific DC/warehouse and transportation policies.
Discuss your strategy relating to launching and scaling the startup
Note: As a question-answering platform, Brainly encourages students to do their own research and provide original answers to academic questions. Therefore, it is not appropriate to request a complete business plan for a startup as it would be a violation of Brainly's policies on academic integrity and originality.
However, here is a brief overview of the different sections you could include in a business plan for a startup:
1. Executive summary: This should provide a brief overview of your business, including your product or service, target market, and unique selling proposition.
2. Company description: This section should provide a detailed description of your company, including its legal structure, location, management team, and mission statement.
3. Market analysis: This should provide a detailed analysis of your target market, including demographic data, market size, and growth trends.
4. Product or service description: This should provide a detailed description of your product or service, including its features, benefits, and competitive advantage.
5. Sales and marketing strategy: This should provide a detailed description of your sales and marketing strategies, including pricing, promotion, and distribution strategies.
6. Financial projections: This should provide a detailed projection of your startup's financial performance, including revenue, expenses, and profitability.
7. Funding requirements: This should provide a detailed description of your startup's funding requirements, including how much funding you need, how you will use the funding, and what your return on investment (ROI) will be.
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The following information pertains to UWC Company, from Vancouver, BC, and its product "Magic Gimmick"
Selling price per unit of "Magic Gimmick": $45.00
Direct material cost per kg: $2.00
Direct labour cost per unit: $1.20
Variable overhead cost per unit: $0.80
Material required per unit: 2kg
Other variable expenses per unit: $0.60
Annual fixed costs:
Advertising: $15,000
Fixed manufacturing: $60,000
Other fixed expenses: $8,000
You are a newly minted MBA and your boss knows that you are able to answer his questions.
Therefore, he asks you for a formal memo which he plans to use with various stakeholders (i.e. senior mgmt., banks, etc.) in which you answer his 3/three questions:
1. What is the break even point in both units and sales dollars?
Memorandum To: Senior Management From: Name, newly minted MBA Subject: Break Even Analysis for UWC Company Dear Senior Management, I am writing to provide you with a break-even analysis for UWC Company.
Break-even point (units) = Fixed Costs / Contribution Margin per unit
Contribution margin per unit = Selling price per unit - Variable costs per unit
Variable costs per unit = Direct material cost per unit + Direct labour cost per unit + Variable overhead cost per unit + Other variable expenses per unit= $2.00 + $1.20 + $0.80 + $0.60= $4.60
Contribution margin per unit = Selling price per unit - Variable costs per unit
= $45.00 - $4.60
= $40.40
Break-even point (units) = Fixed costs / Contribution margin per unit
= $15,000 + $60,000 + $8,000 / $40.40
= 3,660 units
To calculate the break-even point in sales dollars, we can use the following formula:
Break-even point (sales dollars) = Fixed costs / Contribution margin ratio
Contribution margin ratio = Contribution margin per unit / Selling price per unit
= $40.40 / $45.00
= 0.898
Break-even point (sales dollars) = Fixed costs / Contribution margin ratio
= $15,000 + $60,000 + $8,000 / 0.898
= $92,315
The break-even point for UWC Company is 3,660 units or $92,315 in sales dollars.
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Skills Assessment #2 (Excel Exercise) Situation: As Fleet Manager you are requested to provide an analysis of gas expenditures for the FY Total expenditure for gas for the FY was $37,465: Over the FY the highest 3 months were: • January $2562-Feb $3589 and • May $2719 Assignment:
Create an excel spreadsheet that covers the FY – 10-1 thru 9-30 o Including the information for Jan – Feb, and May -
What was the average monthly gas expenditure for the FY? o Based on your analysis:
Provide 3 reasons that could have possibly contributed to the high gas cost for February
If you did not have the gas costs for Jan-Feb-and May – only the total for the FY what would the avg monthly cost be?
Based on the analysis above – What do you estimate for a gas budget for the next FY?
How did you come up with this estimate?
As Fleet Manager, you are required to give an analysis of the gas expenses for the FY, where the total cost of gas for the FY was $37,465. Over the FY, the highest three months were: January $2562-Feb $3589 and May $2719.
we have to first create a spreadsheet that covers the FY – 10-1 thru 9-30 including the information for Jan – Feb, and May. The spreadsheet would look like:{{6c13e49a19732d7f3995d4cc4a4b9bc3}}What was the average monthly gas expenditure for the FY?The average monthly gas expenditure can be determined by using the AVERAGE function, which is =AVERAGE(C3:C14). Based on the analysis, the average monthly gas expenditure for the FY was $3105.77.Based on your analysis, provide 3 reasons that could have possibly contributed to the high gas cost for February.The following are three reasons that could have contributed to the high gas cost for February: Increase in Gas Prices (Higher Demand) Increase in the Number of Vehicles Making Trips Increase in the Distance Covered by the VehiclesIf you did not have the gas costs for Jan-Feb-and May – only the total for the FY what would the avg monthly cost be?If we did not have the gas costs for Jan-Feb-and May – only the total for the FY, we could find the average monthly cost by dividing the total cost by 12.
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Which of the following is the next logical step in Autumn's budget? Decide how much Autumn should save each year Estimate her income for the year List all of her fixed expenses for the year Determine what is included in miscellaneous expenses
The next logical step in Autumn's budget would be to determine what is included in miscellaneous expenses.
Before deciding how much Autumn should save each year or estimating her income for the year, it is important to have a clear understanding of what constitutes miscellaneous expenses. Miscellaneous expenses typically include irregular or variable expenses that do not fit into specific categories, such as unexpected medical expenses, home repairs, gifts, or entertainment.
By listing all of her fixed expenses for the year, Autumn will have a clear picture of her regular financial obligations, such as rent or mortgage payments, utilities, insurance premiums, loan payments, and other recurring expenses. This step helps establish a baseline for her budget.
Once fixed expenses are identified, Autumn can then move on to determining what is included in miscellaneous expenses. This involves reviewing past spending patterns, identifying potential irregular expenses, and estimating their total amount for the year.
With a comprehensive understanding of both fixed and miscellaneous expenses, Autumn can make informed decisions about how much she should save each year and estimate her income accordingly. Budgeting for savings becomes more feasible after accounting for essential expenses and miscellaneous items that may require financial allocation.
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77. You complete a runs test on daily data for a thinly traded stock and the Z statistic is -5.13. If the stock has a return of -0.33% late in the trading day and you are convinced that other investors are not aware of the results, based on the runs test results, an investor would:
Buy or long the stock in late trading.
Sell or short the stock in late trading.
Wait an additional day to buy the stock.
Wait an additional day to short the stock.
Take neither a long or short position in the stock.
None of the above answers is correct.
A runs test is a statistical tool that compares the sequence of data against the presumed random distribution of the data. If the number of runs is too high or too low, it indicates that the data is not distributed randomly, which could mean that the data is biased or nonrandom.
The runs test can be used to determine if a thinly traded stock has an uneven or random distribution of trades, or if the trading pattern is biased or nonrandom. Z statistics measures the number of standard deviations a data point is from the mean. When the Z statistic is negative, it indicates that the data point is below the mean.
When the Z statistic is positive, it indicates that the data point is above the mean. In the question above, the Z statistic is -5.13, which indicates that the data point is 5.13 standard deviations below the mean.
If the stock has a return of -0.33% late in the trading day, an investor who is convinced that other investors are not aware of the results would buy or long the stock in late trading. The investor would do so because the runs test results show that the stock has an uneven or nonrandom distribution of trades, which could mean that the stock is undervalued.
Buying or going long on the stock in late trading could provide an opportunity for the investor to profit from the undervalued stock. Therefore, the correct answer is to buy or long the stock in late trading.
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Suppose a bank has a "gap" of −$50 million dollars. If interest rates rise by 2%, then the change in profits is $ million. Round your response to the nearest whole number.) Jsing duration analysis, if a bank's assets have an average duration of four years and the interest rate rises by 2%, then the ercentage change in the bank's assets is estimated to be %. (Round your response to the nearest whole number.)
To calculate: Change in profitsPercentage change in bank's assetsSolution:Change in profits = (Gap) × (change in interest rates)= (-$50 million) × (0.02) = -$1 million.
The change in profits is $1 million.Percentage change in bank's assets = (- Gap × Change in interest rates) / (1 + Average duration of assets × Change in interest rates)
Percentage change in bank's assets = [(-$50 million) × 0.02] / (1 + (4 × 0.02))= -$1 million / 1.08≈ -0.93 million≈ -93%
Therefore, the percentage change in the bank's assets is estimated to be -93%.
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which step in the appraisal process involves communication of the appraiser's opinions and conclusions?
The step in the appraisal process that involves communication of the appraiser's opinions and conclusions is the Reconciliation Step. This is the last step in the appraisal process, where an appraiser presents their opinion of value derived from their research and analysis.
Appraisal process-
An appraisal process is a methodical approach of determining an estimate of value. It involves research, analysis, and communication of the appraiser's opinions and conclusions.
It can be broken down into different steps, including:
Step 1: Define the problem
Step 2: Preliminary survey and property description
Step 3: Determine the appraisal approach
Step 4: Data collection and analysis
Step 5: Reconciliation of value indications
Step 6: Final appraisal report
Communication of the appraiser's opinions and conclusions happens in the last step of the appraisal process, known as the reconciliation step. In this step, the appraiser presents their opinion of value that is derived from the research and analysis done in the previous steps. The appraiser also needs to explain how they arrived at the opinion of value, describe the scope of work, and provide supporting documentation.
The final report should be clear, concise, and complete. It should be able to support the opinion of value and provide credible evidence to support it. The report should also be in compliance with the Uniform Standards of Professional Appraisal Practice (USPAP). This will ensure that the appraisal report is reliable, accurate, and professional.
To summarize, the step in the appraisal process that involves communication of the appraiser's opinions and conclusions is the Reconciliation Step, which is the last step of the appraisal process.
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Cancellation of Convertible Bonds before the end
Assume that the same $1,000,000 bond from Empresas Buenapaga is convertible to 50,000 common stock value par $10. When the premium has an outstanding unretretized balance sheet of $75,000 bondholders decide to exercise the option to convert the bonds.
Required: Make the journal entry to record the conversion of the bond into common shares.
When a company decides to call its convertible bonds before their due date, it has to pay a certain amount to bondholders before redeeming the bonds. In this case, the bondholders decided to convert the bonds into common shares, and we are required to make the journal entry to record the conversion of the bond into common shares.
The following journal entry will be made to record the conversion of bonds into common shares Account TitlesDebitCreditCommon Stock 50,000 x $10$500,000Premium on Bonds Payable$75,000Bonds Payable$1,000,000$1,075,000$1,075,000. The above journal entry indicates that $1,000,000 worth of bonds was issued, and $75,000 of unamortized premium is recorded on the balance sheet.
Bondholders have decided to convert the bonds into 50,000 common shares, which has been recorded at par value of $10 per share. Therefore, $500,000 has been recorded in common stock. The premium on bonds payable is then reduced to zero by debiting the Premium on Bonds Payable account with $75,000. The amount recorded in the Bonds Payable account is then reduced to zero.
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Differential Analysis for a Lease-or-sell Decision Stowe Construction Company is considering selling excess machinery with a book value of $281,200 (original cost of $400,700 less accumulated depreciation of $119,500) for $276,800 , less a 5% brokerage commission. Altematively, the machinery can be leased for a total of $286,600 for 5 years, after which it is expected to have no residual value. Dunng the period of the lease, Stowe Construction Company's costs of repairs, insurance, and property tax expenses are expected to be $12,000 , a. Prepare a differential analvsis dated March 21 to determine whether'Stowe Construction Company sthould lease (Aiternative 1) or sell (Alternative 2) the machinery. If required, use a minus sign to indicate a loss. b. On the basis of the data presented, would it be advisable to lease or sell the machinery?
Based on the data presented, it would be advisable for Stowe Construction Company to lease the machinery rather than sell it. The lease option provides a higher net cash flow over the 5-year period, which makes it more financially favorable.
To determine whether Stowe Construction Company should lease or sell the excess machinery, we need to compare the differential costs and revenues associated with each alternative.
Here is a step-by-step analysis to determine the most advisable option:
1. Calculate the proceeds from selling the machinery:
- The selling price is $276,800.
- Subtract the 5% brokerage commission: $276,800 - (5% * $276,800) = $262,960.
2. Calculate the lease payments over 5 years:
- The total lease payment is $286,600.
3. Calculate the cost of repairs, insurance, and property tax expenses over 5 years:
- The expenses are $12,000 per year.
- Multiply by 5 years: $12,000 * 5 = $60,000.
4. Calculate the net cash flow for each alternative:
- For the sale option: Net cash flow = Proceeds from selling - Cost of repairs, insurance, and property tax expenses
- For the lease option: Net cash flow = Lease payments - Cost of repairs, insurance, and property tax expenses
Net cash flow for the sale option: $262,960 - $60,000 = $202,960
Net cash flow for the lease option: $286,600 - $60,000 = $226,600
5. Compare the net cash flows:
- The lease option has a higher net cash flow of $226,600 compared to $202,960 for the sale option.
Based on the data presented, it would be advisable for Stowe Construction Company to lease the machinery rather than sell it. The lease option provides a higher net cash flow over the 5-year period, which makes it more financially favorable. However, it's important to consider other factors such as future equipment needs and the potential for technological advancements before making a final decision.
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The current price of one share of GBP stock is 50.00. Aaron Rodgers purchases (long) a call option on GBP stock with a strike price of 53.00 and one-year to maturity. The price of the option is 4.95. The continuously compounded risk free rate is 4%.
What is Aaron’s profit at the end of one year if the stock price at that time is 60.00 per share?
What is Aaron’s profit at the end of one year if the stock price at that time is 40.00 per share?
What is the breakeven stock price of his portfolio?
What is the minimum profit of his portfolio?
What is the maximum profit of his portfolio?
The solution to the given per share, the minimum profit of his portfolio is -12.11, and the maximum profit of his portfolio is infinite. is given below; Aaron’s profit at the end of one year if the stock price at that time is 60.00 per share.
The calculation of Aaron's profit is the difference between the stock price and the strike price minus the cost of the option and the interest paid on the option. the profit of Aaron can be calculated as;
Profit = (60 - 53) - 4.95 - [53 x exp(-0.04 x 1)]
Profit = $2.43
per share Aaron’s profit at the end of one year if the stock price at that time is 40.00 per share Similarly, the profit of Aaron when the stock price at the end of one year is $40 can be calculated as;
Profit = 0 - 4.95 - [53 x exp(-0.04 x 1)]Profit = -$13.07
The breakeven price is the price at which the profit of the investor is zero. the breakeven price can be calculated as;
0 = (S - 53) - 4.95 - [53 x exp(-0.04 x 1)]S = $57.22 per share
Minimum Profit = -4.95 - [53 x exp(-0.04 x 1)]
The maximum profit of the portfolio is unlimited as there is no limit on how high the price of the share could go, the maximum profit of the portfolio is infinity.
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