Answer: OPTION C
Explanation The answer to this question is cash payback and average rate of return method.
Capital rationing is the method used by companies to effectively allocate the limited funds a company has on alternative funds.
Under payback period method the company evaluates how much time will it take a project to recover its initial cost and as per average rate of return method the company evaluates the return generated from the net income, it does not take into consideration the time value of money.
Answer:
Decrease
Explanation:
The accountant's revenue will decrease because the demand for his services has fallen by 1,818%, while the price he charges has only gone up by 66%.
The rise in prices will not be enough to cover the losses for such a deep fall in demand.
For example, suppose that before, the accountat used to complete 200 services a month for $100 per year, his total revenue is = 200 x $100 = $20,000.
Now, he will charge 68% more, the new service fee is $168, but demand for his services will now be a negative 3436 (200 x 1,818% = 3636), so his revenue will be 0, or even, negative (he could get into debt to afford his expenses).
I think the answer is c. july 3rd !
