The price elasticity of the loan taken by the entrepreneur comes out to be 10.
<h3>
What is the price elasticity of demand?</h3>
The price elasticity of demand is an indicator used to determine the sensitivity of demanded quantity with respect to its corresponding price.
Given values:
Change in quantity demanded: 50%
Change in price: 5%
Computation of price elasticity of demand:
Therefore, when the change in quantity demanded is 50% with the change in the price is 5%, then the price elasticity of a business loan is equal to 10.
Learn more about the price elasticity in the related link:
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Answer:
$80,500
Explanation:
Data provided as per the question
Capital asset = $23,000
Number of year = 5
Income tax rate = 30%
The computation of cash inflow from operations is as shown below:-
Before tax = capital asset × number of year
= $23,000 × 5
= $115,000
Cash inflow from operations = Before tax × (1 - Income tax rate)
= $115,000 × (1 - 0.3)
= $115,000 × 0.7
= $80,500
Giving positive reinforcement when a student comes close to what you wanted
Explanation:
The Journal entry is given below :-
Bonds payable $2,000,000
To common stock $1,000,000
To Discount on common stock $30,000
To Paid in capital $970,000
The calculation of bonds payable, common stock is below:-
For bonds payable
= 2,000 × $1,000
= $2,000,000
For common stock
= 2,000 × 50 × $10
= $1,000,000
For paid in capital
= $2,000,000 - ($1,000,000 - $30,000)
= $970,000
Answer:
80000 unit of Alpha
Explanation:
This is a Limiting factor/resource constraint question. In certain situations entities suffer from shortage of necessary resources (e.g: shortage of material, labor hours, machine hours), in such circumstances entities strive to allocate the constraint resources to the production of those products which generate the highest contribution per limiting factor and help maximize total contribution. In this case the limiting factor for Cane is Raw material.
Lets suppose that each unit of <em>Alpha and Beta sell for $120 and $80</em> respectively and variable cost per unit of <em>Alpha and Beta is $69 and $20 </em>respectively. Each unit of <em>Alpha and Beta require 2 and 5 pounds</em> of raw material for production respectively.
Now that we have supposed the data we have to compute contribution per unit and then contribution per limiting factor and based on the ranking (i.e highest first) of contribution per limiting factor we decide which product should be given priority for resource allocation.
<em>Lets calculate contribution per unit.</em>
Alpha:
Contribution per unit= SP-VC
Where, SP stands for selling price and VC stands for variable cost.
CPU= 120-69
CPU=$51
Beta:
Contribution per unit= 80-40
CPU=$40
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<em>Now, lets calculate contribution per limiting factor.</em>
Alpha:
CLF: $51÷2
CLF: $25.5 1st Rank
Beta:
CLF: $40÷5
CLF: $8 2nd Rank
So clearly Alpha has a greater contribution per limiting factor and it implies that Alpha will earn the highest contribution margin therefore Cane should produce and allocate resources to Alpha first and then Beta if there remains any?
Profit maximizing output:
It requires 2 pounds of raw material to produce one unit of Alpha (i.e 80000×2=160000) Therefore Cane should produce 80000 units of Alpha only in order to maximize its profits.
