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3 years ago

6

Barb's Bakery made $200 last month selling 100 loaves of bread. This month it made $300 selling 60 loaves of bread. What is the

price elasticity of demand for Barb's bread?

1 answer:

Virty [35]3 years ago

5 0

The answer will be 150 dollars

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Ray Stokes is raising capital for a new company called NO Balloons Inc. NO Balloons will manufacture and sell festive balloons.

Sergeeva-Olga [200]

Answer:

NO Balloons' WACC = 7%

Explanation:

WACC = Weighted average cost of capital

The weighted average cost of capital (WACC) refers to calculation of a firm's cost of capital in which each category of capital is proportionately weighted. All sources of capital, including <u>common stock</u>, <u>preferred stock</u>, <u>bonds</u>, and <u>any other long-term debt</u>, are included in a WACC calculation.

<u>Respective calculation of WACC:</u>

<u>Step 1: Calculate the value of equity:</u>

Number of shares = 12 million

Share price = $19.5 per share

Value of equity = 12 million shares * 19.5/share = $234 million (A)

<u>Step 2: Calculate the value of debt: </u>

Bonds = 200,000

Value of debt = 200,000 bonds * 1000 face value/bond * 89% sale price = 178 million (B)

<u>Step 3: Calculate the firm value: </u>

Total firm value (A+B) = 234 + 178 = 412 million

<u>Step 4: Calculate the weight of equity: </u>

Dividing the value of equity to total firm value:

Weight of equity = 234 / 412 = 0.5680

<u>Step 5: Calculate the weight of debt: </u>

Dividing the value of debt to total firm value

Weight of debt = 178 / 412 = 0.4320

<u>Step 6: Calculation of WACC :</u>

WACC = weight of equity * cost of equity + weight of debt * cost of debt = 0.5680 * 9.275% + 0.4320 * 4% = 7%

7 0

3 years ago

L Corporation produces and sells 15,300 units of Product X each month. The selling price of Product X is $23 per unit, and varia

Arlecino [84]

Answer:

<em><u>It would generate a financial disadvantage for 62,800</u></em>

Explanation:

$\left[\begin{array}{cccc}-&continued&discontinued&differential\\Sales&351,900&0&-351,900\\Variable&-260,100&0&260,100\\Contribution&91,800&0&-91,800\\Fixed&-103,000&-74,000&29,000\\total&-11,200&-74,000&-62,800\\\end{array}\right]$

It would generate a financial disadvantage for 62,800

Because the product, while is having a loss, their contribution cover is enought to cover at least the avoidable fixed cost.

5 0

2 years ago

PURCHASING POWER PARITY In the spot market, 19.1 Mexican pesos can be exchanged for 1 U.S. dollar. A compact disc costs $15 in t

LiRa [457]

Answer: $286.50

Explanation:

Purchasing Power Parity (PPP) posits that prices are the same across countries given the rate of exchange between the currencies of the countries in question.

1 USD = 19.1 Mexican pesos.

Compact disc in Mexico would cost;

= 19.1 * 15

= $286.50

8 0

3 years ago

The corporate charter of Martin Corporation allows the issuance of a maximum of 4,000, 000 shares of $1 par value common stock.

raketka [301]

Answer:

(a) 4,000,000

(b) 3,200,000

(c) 3,170,000

(d) $3,200,000

(e) $750,000

Explanation:

(a) Number of shares authorized = 4,000,000

(b) Number of shares issued = 3,200,000

(c) Number of shares outstanding:

= Number of shares issued - Acquired shares as treasury stock

= 3,200,000 - 30,000

= 3,170,000

(d) Balance of the Common Stock account:

= Number of shares issued × Par value

= 3,200,000 × $1

= $3,200,000

(e) Balance of the Treasury Stock account:

= Acquired shares as treasury stock × Price per share

= 30,000 × $25

= $750,000

4 0

3 years ago

If a product becomes more expensive to

dem82 [27]

Answer: to the left.

Explanation:

5 0

1 year ago