There are different kinds of market. The option that is not a reason perfect competition is a useful simplification, despite the diversity of market types we find in the world is that;
- There are many buyers and many sellers in all types of markets.
<h3>What leads to perfect competition?</h3>
Firms are known to be in perfect competition due to;
- When many firms produce identical products.
- When there are plenty buyers available to buy the product, and and also plenty sellers are available to sell the product, etc.
Firms are said to be in perfect competition when a lot of firms produce the same type of products and also these firms can do business in the market without any kind of restrictions.
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a. 50 cents
Contribution margin per unit is price per unit- variable cost per unit
1.75 - ($50,000/40,000 units)
1.75 - 1.25 = $ .50
b. $8750
Margin of safety is the expected sales - break even sales
(45,000 units * $1.75 per unit) - (40,000 *1.75)
78,750 - 70,000 = $8750
The correct answer is D. All of these.
Answer:
B and C
Explanation:
The correct statements about the factor-price equalization and the effects of transportation costs are:
- Free trade, in the absence of transportation costs or other barriers to trade, tends to equalize product prices and factor prices.
- Transportation costs prevent product prices from equalizing.
Answer:
Net income for the year = $257,000
Explanation:
Retained earnings for the year= Net income - dividends paid.
Since no dividends were paid, retained earnings for the year = net income for the year. At the end of each accounting period, retained earnings are reported on the balance sheet, and the retained profits for the year are added to the beginning balance of retained earnings, to give a cumulative ending balance of $2,499,000.
therefore retained earnings for the year = ending retained earnings balance - beginning retained earnings balance = $2,499,000.-$2,242,000= $257,000.
Net income for the year is thus = $257,000 since no dividends were paid.
