Answer:
Provided in Explanation
Explanation:
This is a very general question however I’ll try to answer it to the best of my knowledge.
If I use my own assumptions then these will be the Projections:
Selling Price $79.99 Selling Price $69.99
Cost of Sales/unit $40.00 Cost of Sales/unit $40.00
Expenses/unit $15.00 Expenses/unit $15.00
Demand @ $79.99 1000 Demand @ $69.99 1200
Sales $79,990.00 Sales $83,988.00
Cost of Sales $40,000.00 Cost of Sales $48,000.00
Expenses $15,000.00 Expenses $18,000.00
Profit $24,990.00 Profit $17,988.00
The final decision however relies on the Price Elasticity of the Product. If the Product is Price elastic then lowering the Price will lead to a significant rise in Demand. However if the Product is Price inelastic then lowering the Price will not lead to a significant rise in Demand and thus profit margins will be lowered. If the Product is Price inelastic then it is better to increase prices in order to gain more profits. In the case of Unit Elasticity the change in Demand will be at the same proportion as price change so it won’t be of any use to change the Price.
Answer:
TIE 2.47
Explanation:
Our first step will be calculate the interest expense
350,000 debt outstanding * 12% rate = 42,000
Next, we need the EBIT which means Earnings Before Interest and Taxes.
Using the net profit margin of 3% we can get the net income
This means 3% of sales become net income
We are going to apply this to Morris sales to get the net income
Now this include the interest and taxes, we need to get the Earning before those two concepts so:
Now we got everything needed for the TIE
129,500/52,500 = 2.47
Answer:
We generally calculate total average cost by dividing total cost / total output units.
In this case, we are not given the output units, but instead we are given the output value, so we should find a percentage from total revenue.
total costs = $4,800,000
total revenue = $20,000,000 + $5,000,000 = $25,000,000
average total cost = ($4,800,000 / $25,000,000) x 100 = 19.2%
This means that for every $100 of revenue, the merged company will spend $19.20.
This is an example of "proximal goal".
Proximal objectives are best characterized as here and now and are instrumental in accomplishing distal objectives in which are long haul. The proximal objectives are the giving wellsprings of extra data in regards to exhibitions that isn't uncovered with a distal objective. It is basic that proximal objectives are more sensible to achieve the fulfillment on account of the time hole in getting the objectives. For a complex task, it would not bode well to have distal objectives set up in light of the fact that it at that point would set aside a long span of opportunity to close outcomes in a snappy way.
Answer:
Total PV= $25,072.57
Explanation:
Giving the following information:
Cash flows:
Cf1= $6,100
Cf2= $11,100
Cf3= $17,300
Discount rate= 15%
<u>To calculate the present value, we need to use the following formula on each cash flow:</u>
PV= Cf / (1+i)^n
PV1= 6,100 / 1.15= 5,304.35
PV2= 11,100 / 1.15^2= 8,393.19
PV3= 17,300 / 1.15^3= 11,375.03
Total PV= $25,072.57
