The correct answer should be d. Identify the problem.
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Answer:
$93,500
Explanation:
Given that,
Purchased new equipment for cash = $80,000
Transportation costs = $2,000
Sales tax paid = $7,000
Installation cost = $4,500
Cost of equipment:
= Cash purchase price + Transportation cost + Sales tax paid + Installation cost
= $80,000 + $2,000 + $7,000 + $4,500
= $93,500
Therefore, the cost recorded for the equipment was $93,500.
Answer:
The elasticity of Diet Pepsi rose, and its ability to raise revenues through price increases fell.
Explanation:
When a good has very close substitutes, like Diet Pepsi does with respect to Diet Coke, said good has a elastic price elasticity of demand, because the quantity demanded of it falls proportionally more than an increase in price since consumers turn to the substitute good when said good becomes more expensive.
If the price of Diet Pepsi rises, people can simply buy Diet Coke, potentially reducing revenue for Pepsi even more, despite the price increases.