Answer: (A) inelastic
Explanation: In inelastic demand it states that by increasing the cost price it will create a proportionality in the total revenue ,that is revenue will also increase.In this case the demand of the buyer does not change, only the cost changes and the consumer will keep on buying the goods even after change in price.
Opera Estate Girls' School is also using this technique to increase the revenue,by increasing the tuition.Thus the correct option is option (A).
Answer:
COFFEE SHOPS would have a larger potential customer base.
NEW SHOE STORE is geared toward individuals with more disposable income.
Explanation:
The logic here is quite simple, households earning $25,000 or more are likely to be customers of the coffee shops. This also includes households earning $55,000 or more. So the consumer base of coffee shops is very large.
On the other hand, only households earning $55,000 or more are likely to be customers of the new shoe store. Since there are fewer households that earn $55,000 or more, their consumer base will be smaller and it should rather focus on people with more disposable income.
Even if 90% of the people earn above $55,000 and only 10% earn between $25,000 - $55,000, the consumer base of coffee shops will always be larger since it includes almost everyone.
The correct entry to record the cash sales is
<span>Debit Cash $2058
credit Cash Over and Short $ 8
credit Sales $2050
The cash over and short will record the amount of cash that is not recorded during the initial transaction. Almost all stores experience cash over and short daily, and usually will be taken monthly from an account set aside by the stores to cover the mistake by its employees.
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Answer:
Optimal qauntity is 4 Units
Explanation:
Here, we have to decide quantity of production at which maximum profit can be generated. For this reason we will have to contruct a table which will help us to calculate Marginal Benefit and Marginal cost. This table is given as under:
Quantity Total benefit Marginal benefit Total Cost Marginal Cost
0 Units 0 0 0 0
1 Units 16 16 9 9
2 Units 32 16 20 11
3 Units 48 16 33 13
4 Units 64 16 48 15
5 Units 80 16 65 17
We can see that at 4 Units, marginal revenue is almost equal to marginal cost. At this level of production, we have maximum benefits generated which is:
Maximum Benefit Generated = ($16 - $9) + ($16 - $11) + ($16 - $13) + ($16 - $15) = $7 + $5 + $3 + $1 = $16 for 4 Units
We can also cross check by considering 5 units case to assess whether the benefit generated is more than 4 units case or not.
Maximum Benefit Generated (For 5 Units) = ($16 - $9) + ($16 - $11) + ($16 - $13) + ($16 - $15) + ($16 - $17) = $7 + $5 + $3 + $1 - $1 = $15 for 4 Units
As the maximum benefit generated in the case of 4 units is more because of using marginal revenue = Marginal Cost relation, hence the optimal quantity is 4 units.
Answer:
Explanation:
Starbucks has existed for quite long in the United States. Its name is generally synonymous with coffee. Its success in foreign but less developed and emerging markets may be attributed to perception, owing to advertisements and popularization. Advertisements made to potential consumers glamourize the products, making potential purchasers more. Popularization, on the other hand may be attributed to “showbiz”- celebrity synonymity with Starbucks’ products. A movie may feature celebrities taking a Frappuccino from Starbucks. Upon arrival in a new market, a celebrity’s fan is most likely to take a Frappuccino since celebrity so and so took it in a certain movie and declared it good. Another reason for success may be that the bourgeoisie individuals of an emerging market may take to Starbucks products in order to enjoy what their counterparts in developed markets have been enjoying and glamorizing.
