Answer:
The net income will increase by $6,712 if the subcomponent is purchased.
Explanation:
Giving the following information:
Swifty Corporation incurs the following costs to produce 9900 units of a subcomponent:
Direct materials $8316
Direct labor 11187
Variable overhead 12474
Fixed overhead 16200
Total cost= $48,177
An outside supplier has offered to sell Swifty the subcomponent for $2.85 a unit.
Swifty could avoid $3000 of fixed overhead by accepting the offer.
We need to calculate the total cost of buying the subcomponent:
Buy:
Total cost= 9,900*2.85 + (16,200 - 3,000)= $41,415
The net income will increase by $6,712 if the subcomponent is purchased.
Explanation:
Classifying of each situation with the correct combination of change in price and quantity:
a. On a hot day, both demand for lemonade and supply of lemonade increase - Pp? Q increase
b. On a cold day, both demand for ice cream and the supply of ice cream decrease - Pp? Q decrease
c. When Hawaii's Mt. Kilauea erupts violently, the demand on the part of tourists for sightseeing flights increases but the supply of pilots willing to provide these dangerous flights decreases- P increase Qq?
d. In a hot area of Arizona where they generate a lot of their electricity with wind turbines, the demand for electricity falls on windy days as people switch off their air conditioners and enjoy the breeze. But at the same time, the amount of electricity supplied increases as the wind turbines spin faster - P decrease Qq?
Answer:
third
Explanation:
The utility for consuming the first donut is 9 utils.
The utility for consuming the second donut is the difference from the total utility for the first two and just the first donut.
The utility for consuming the third donut is the difference from the total utility for the first three and just the first two donuts.
The utility for consuming the fourth donut is the difference from the total utility for the first four and just the first three donuts.
Since the utility for the 4th donut is less than the utility for the 3rd donut, utility begins to diminish after consuming the third donut.
Reduction in the price. If they do not reduce the price, then people will not buy the product, and they will be left with too many of the same products.
