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4 years ago

Constant cost industries:

Business

1 answer:

adoni [48]4 years ago

7 0

Answer:

The correct answer to the following question will be Option C.

Explanation:

Constant cost industries seem to be a sector wherein the proportion of units produced as well as manufacturing costs every unit maintains the very same irrespective including its amount of manufacturing or rise in population. Which doesn't use input data in the appropriate amount to influence the rates of that same components by a shift in industry revenue.
This doesn't even use inputs in such amounts that perhaps the costs of that same inputs will be influenced by a change in business production.

The other choices are not linked to an industry of this kind. Therefore the clarification above is correct.

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Both Bond Sam and Bond Dave have 7 percent coupons, make semiannual payments, and are priced at par value. Bond Sam has three ye

3241004551 [841]

Solution:

Each bonds have a 7 percent coupon limit. Since sales are also equivalent to 7 percent with par with YTM. The age of Bond Sam is three years and the maturity of Bond Dave is sixteen. At a sudden increase of 2%, interest rates. Decide the shift in both bond price by percentage.

Bond Sam:

Bond Value = pv(rate,nper,pmt,fv)

Rate = (7%+2%)* 1/2 = 4.5%

nper = 3*2 = 6

fv = 1000

pmt = 7%*1000*1/2 = $35

Bond Value = -pv (4.5%,6,35,1000)

Bond Value =$936.65

Percentage change in the price of Bond Sam = (936.65-1000)/1000 Percentage change in the price of Bond Sam = -6.33%

Bond Dave:

Bond Value = pv (rate, nper, pmt, fv)

Rate = (7%+2%)*1/2 = 4.5%

nper = 16*2 = 32

fv = 1000

pmt = 7%*1000*1/2 = 35

Bond Value = pv (4.5%,32,35,1000)

Bond Value = $854.66

Percentage change in the price of Bond Dave = (854.66-1000)/1000 Percentage change hi the price of Bond Dave = -14.53%

4 0

4 years ago

A loan of $5,000 is charged a 12% annual interest rate. An $80 payment is made each month. a. Write a recurrence relation for th

klemol [59]

Answer:

$4163.57

Explanation:

Please see attachment

7 0

3 years ago

In the Gabbana Company, maintenance costs are a mixed cost. At the low level of activity (40 direct labor hours), maintenance co

Vladimir79 [104]

Answer:

(i) $8.33 per unit

(ii) $267

Explanation:

Under high-Low method:

$Variable\ cost=\frac{Cost\ at\ high\ activity-cost\ at\ low\ activity}{Highest\ activity-Lowest\ activity}$

$Variable\ cost=\frac{1,100-600}{100-40}$

$Variable\ cost=\frac{500}{60}$

= $8.33

Total cost = variable cost per unit + Fixed cost

1,100 = (8.33 × 100) + Fixed cost

1,100 - 833 = Fixed cost

$267 = Fixed cost

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3 years ago

Kamy Corp. is in liquidation under Chapter 7 of the Federal Bankruptcy Code. The bankruptcy trustee has established a new set of

AveGali [126]

Answer:

C) $9,000

Explanation:

Debits to the equity state represent additional expenses or losses that were not previously recorded.

gain/loss = cash - carrying value of truck = $12,000 - $20,000 = -$8,000 or $8,000 loss
additional repair costs = $1,000 (machinery repairs)

Total unrecorded losses and expenses = $8,000 + $1,000 = $9,000

5 0

3 years ago

Gomez runs a small pottery firm. He hires one helper at $13,000 per year, pays annual rent of $5,500 for his shop, and spends $2

alisha [4.7K]

Answer:

(a) $35,000

(b) $8,000

Explanation:

(a) Accounting profit:

= Total revenue - Explicit cost

= $75,000 - (wages + Annual rent + Material cost)

= $75,000 - ($13,000 + $5,500 + $21,500)

= $75,000 - $40,000

= $35,000

(b) Economic Profit:

= Total revenue - Explicit costs - Implicit costs

= $75,000 - (wages + Annual rent + Material cost) - (Income from investment + Earnings as a potter + Worth of entrepreneurial talents)

= $75,000 - ($13,000 + $5,500 + $21,500) - ($5,500 + $19,000 + $2,500)

= $75,000 - $40,000 - $27,000

= $8,000

8 0

4 years ago