Answer:
The optimal order quantity is 316 pounds
Explanation:
In order to calculate What daily order quantity is optimal, we have to calculate first The cost of underestimating the demand Cu and cost of overestimating demand Co
Cu = ($0.60 - $0.50)*4 = $0.40
Co = $1 - $0.80 = $0.20
Next we have to calculate the Service Level = Cu / (Cu + Co)
= 0.40 / (0.40 + 0.20)
= 0.40/0.60
= 0.6667
So, Z Value at above service level = 0.430727
Therefore, in order to calculate the Optimal Order quantity, we would have to use the following formula
Optimal Order quantity= Mean + Z Value × Std Deviation
= 301 + 37 * 0.430727
= 301 + 15.36899
= 316 pounds
Answer: $27.47
Explanation:
Given: Growth rate = 4.70% per year = 0.0470 per year
Dividend of next year = $2.50
Expected rate of return on Stock = 13.80% =0.1380
Current price = (Dividend of next year ) ÷ (Expected rate - Growth rate)
= (2.50)÷ (0.1380-0.0470)
= (2.50) ÷ (0.091)
≈ $27.47
Hence, you will pay $27.47 for the company's stock today.
Answer: Option (c) is correct.
Explanation:
Given that,
Alternatives for a person if he do not attend his neighbor's barbecue:
(1) Watch television with some friends = he value this at $17
(2) Read a good novel = he value this at $14
(3) Go in to work = he could earn $16 during the barbecue
Opportunity cost is the benefit that is foregone for an individual by choosing one alternative over other alternatives available to him.
If the opportunity cost is lower for an individual then this will benefit him whereas if the opportunity cost is higher then this will not benefit the individuals.
Therefore, the opportunity cost of going to his neighbor's barbecue is the enjoyment he get from watching television with some friends because this is the highest valued alternative forfeited.
Answer:
d) $300
Explanation:
<em>Marginal revenue is the extra revenue from a resource the extra revenue earned from the use of additional unit of a given resource for production purpose. It is calculated as the increase in total revenue as a result of utilizing one additional unit of a factor of production.</em>
Marginal revenue = total revenue from 85 units - total revenue from 70 units
Marginal revenue = ($20 × 85) - ($20× 70)
= $300
Answer: $2.1 million
Explanation:
It is mentioned the project is independent of the outcome of general market which means that
=> beta = 0
Using the CAPM formula which is,
r=rt + B* (rm -rf)
=> r = 3% + 0*(12%-3%) = 3%
Expected value of Project in one year = $1 billions * 0.1
Expected value of Project in one year = $100 millions
NPV = Expected value of Project in one year/ (1 + 0.03) - Initial cost
NPV = 100/ (1 + 0.03) - 95
NPV = 97.1 - 95
NPV = $2.1 million
