7. In capitalism, most businesses have a profit motive. Describe at least one reason that businesses with a profit motive may be
1 answer:
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Answer:
equilibrium quantity = 7
equilibrium price = 107
Explanation:
Data provided in the question:
supply function, p = q² + 6q + 16 ........(1)
demand function is p = −7q² + 2q + 436
Now at equilibrium
Demand = Supply
Thus,
q² + 6q + 16 = −7q² + 2q + 436
or
q² + 6q + 16 + 7q² - 2q - 436 = 0
or
8q² + 4q - 420 = 0
or
2q² + q - 105 = 0
on solving for the roots of q
using the Quadratic Formula where
a = 2, b = 1, and c = -105
a = 2, b = 1, and c = -105
Thus,
The discriminant ( b² - 4ac > 0)
so, there are two real roots.
Therefore,
since,
Quantity cannot be negative
Thus,
q = 7
therefore, substituting q in (1)
p = 7² + 6(7) + 16
or
p = 49 + 42 + 16
or
p = 107
Answer:
5,280 net income for the Year 3
Explanation:
This would be the situation:
17,400 revenue
11,000 expenses
gain/loss on sale of equipment
= net income year 3
To know the result of the sale of equipment we have to do
sales price - book value = gain/loss on sale of equipment
8900 - book value = gain/loss
We have to determinate the book value.
book value = adquisition cost - acumulated depreciation
The equipment cost 15,200 + 1,300 transportation cost = <u>16,500 Adquisition Cost</u>
acumulated depreciation = depreciation per year * 3 years
and depreciation per year is:
Here we have all the values, so we stop digging and start solving.
- <em>depreciation </em>= (16,500-5,700)/5 = 2,160
- <em>acumulated depreciation</em> = 2,160 * 3 = 6,480
- <em>book value</em> = 16,500 - 6,480 = 10,020
- <em>gain/loss </em>= 8,900 - 10,020 = -1,120 LOSS on sale of Equipment
net income = 17,400 - 11,000 - 1,120 = 5,280 net income for the Year 3