For amounts over 35,000 units, in house option A is cheaper.
Find the break even quantity (aka make the equations equal) of the outside vendor compared to each in-house option.
Vendor vs in house option A:
10x = 175,000 + 5x (subtract 5x from both sides)
5x = 175,000 (divide by 5)
x = 35,000 units
vendor is cheaper than option A up to 35,000 units
Vendor vs. in-house option B
10x = 190,000 + 4x (subtract 4x from both sides)
6x = 190,000 (divide by 6)
x = 31,667 (rounded to nearest unit)
vendor is cheaper than option B up to 31,667 units
Answer:
There is a direct relationship between perceived risk and external research. The higher the perceived risk, the more external research a consumer will carry out. Perceived risk is not simply fearing that you will make a bad purchase, but it also refers to the costs and benefits associated with the purchase.
The higher the benefits that a consumer can obtain from a purchase, the higher the risk of not getting enough benefits if they make a bad choice. E.g. if you have a lot of good choices available, then you will want to do some more research to choose the best one.
Generally consumers include more brands in their search when they are physically in stores. As consumers we generally consider a very limited number of brands when we shop online, but when we are in a store, we tend to broaden our search and include al the brands that we find.
Answer:
False
Explanation:
The burndown chart is a visual analysis tool used in projects execution to express the work completed daily against the outstanding purposely to ensure that project are completed and delivered with the agreed timeline.
It measures effort in relation to the level of work done and also keep the team on daily schedule.
The chart represents the work done on the vertical (Y) axis and the time on the horizontal (X) axis.
Answer: D
Explanation: A capital budgeting project is usually evaluated on its own merits. That is, capital budgeting decisions are treated separately from capital structure decisions. In reality, these decisions may be highly interwoven. This interweaving is most apt to result in firms accepting some negative NPV all-equity projects because changing the capital structure adds enough positive leverage tax shield value to create a positive NPV.An optimal capital structure is the objectively best mix of debt, preferred stock, and common stock that maximizes a company’s market value while minimizing its cost of capital.
In theory, debt financing offers the lowest cost of capital due to its tax deductibility. However, too much debt increases the financial risk to shareholders and the return on equity that they require. Thus, companies have to find the optimal point at which the marginal benefit of debt equals the marginal cost. As it can be difficult to pinpoint the optimal structure, managers usually attempt to operate within a range of values. They also have to take into account the signals their financing decisions send to the market.
A company with good prospects will try to raise capital using debt rather than equity, to avoid dilution and sending any negative signals to the market. Announcements made about a company taking debt are typically seen as positive news, which is known as debt signaling. If a company raises too much capital during a given time period, the costs of debt, preferred stock, and common equity will begin to rise, and as this occurs, the marginal cost of capital will also rise.
To gauge how risky a company is, potential equity investors look at the debt/equity ratio. They also compare the amount of leverage other businesses in the same industry are using on the assumption that these companies are operating with an optimal capital structure—to see if the company is employing an unusual amount of debt within its capital structure.
Answer:
In a company you are given partial ownership by Stocks, and a company or government loan by you. The biggest difference among them is how they generate profit: inventories must be valued and sold later, while most bonds pay fixed interest over time.
Explanation:
