Solution :
c. MC=MR is the profit maximizing equilibrium point. The price rise beyond that is likely to raise the total revenue. But the total cost might increase equally or more then that to nullify or decrease the profit.
d. (i). The demand increase implies that the AR (demand) curve shifts rightwards. This will increase the equilibrium price.
(ii). Change in demand does not affect the total cost.
a. Monopoly might continue to produce in short earn even if its AR < AC. It continues to do so until shut down point. It refers that production continued until average revenue (AR) is greater than equal to the average variable cost (AVC). The monopoly is a market with a single seller.
This market's average revenue (AR) demand curve is above its marginal curve . The curves are downward sloping, illustrating price demand inverse relationship.
Equilibrium quantity : when the marginal revenue = marginal cost
Equilibrium price : equilibrium quantity corresponding price at AR (demand ) curve.
Answer:
Total FV= $3,433,859.29
Explanation:
<u>First, we will calculate the future value of each equal annual deposit. Then, the ending value in 33 years of investment as a whole.</u>
FV= {A*[(1+i)^n-1]}/i
A= annual deposit
FV1= {3,500*[(1.137^6) - 1]} / 0.137= $29,648.89
FV2= {8,800*[(1.137^11) - 1]} /0.137= $199,476.80
FV3= {14,400*[(1.137^16) - 1]} /0.137= $714,882.03
<u>Now, the total future value:</u>
FV= PV*(1+i)^n
FV1= 29,648.89*(1.137^27)= 949,600.61
FV2= 199,476.80*(1.137^17)= 1,769,376.65
FV3= 714,882.03
Total FV= $3,433,859.29
Answer:
Hero
Explanation:
Hero -
It refers to a person can be male as well as a female , who is admired for his or her noble and courageous activity , is referred to as a hero .
Many people makes the hero his or her ideal an tries to follow the lifestyle , character , behavior and nature , and tries to copy him .
Hence , from the given scenario of the question ,
The correct answer is hero .
Answer:
40 days.
Explanation:
In the absence of the information about opening receivables, the closing figure is assumed to be the average accounts receivables,
Hence,
Debtors Turnover Ratio for Reagan:
= Sales ÷ Average Accounts Receivables
= $608,000 ÷ $73,922
= 8.22 times
Assuming that the number of days in a year as 365,
the firm's days sales uncollected for the year works out to:
= 365 days ÷ Debtors Turnover Ratio
= 365 ÷ 8.22
= 40.40 or 40 days.
Answer:
The difference between two WACC is 1.2%.
Explanation:
As we know that
WACC = Ke * Ve / (Ve + Vd (1-Tax)) + Kd * Vd*(1-tax) / (Ve + Vd*(1-Tax))
Using the Book Value Method:
WACC = 14% *$65 / ($65m + $45m (1-40%))
+ 6% *$45m*(1-.4) / ($65m + $45m (1-40%))
WACC = 10% + 1.8% = 11.8%
<u>Using the market value method:</u>
Market Value of Common Stock = Common Shares * Market value per share
Market Value of Common Stock = 10 million * $22.5 per share = $225m
WACC = 14% *$225 / ($225m + $50m (1-40%))
+ 6% *$50m*(1-.4) / ($225m + $50m (1-40%))
WACC = 12.35% + 0.7% = 13%
The difference between two WACC is 1.2%.
