There will be a higher equilibrium price and lower quantity if ____

7. Problems and Applications Q7 A dozen eggs cost $0.96 in December 2000 and $2.75 in December 2015. The average wage for worker

fredd [130]

Answer: 187%

Explanation:

The percentage increase in the price of dozen egg would be:

= ( 2.75-0.96) × 100/ 0.96

= 1.79 × 100 / 0.96

= 186.45%

The percent increase in the price of dozen egg = 187%

4 0

2 years ago

Vulcan, Inc., has 8.7 percent coupon bonds on the market that have 10 years left to maturity. The bonds make annual payments and

Lana71 [14]

Answer:

$880.72

Explanation:

Bond price will be calculated by following formula

Bond Price = C x [ ( 1 - ( 1 + r )^-n ) / r ] + [ F x ( 1 + r )^-n ]

Bond Price = $87 x [ ( 1 - ( 1 + 0.107 )^-10 ) / 0.107 ] + [ $1,000 x ( 1 + 0.107 )^-10 ]

Bond Price = $87 x [ ( 1 - ( 1.107 )^-10 ) / 0.107 ] + [ $1,000 x ( 1.107 )^-10 ]

Bond Price = $518.87 + $361.85

Bond Price = $880.72

6 0

2 years ago

Starling Co. manufactures one product with a selling price of $18 and variable cost of $12. Starling’s total annual fixed costs

nikitadnepr [17]

The number of units that Starling Co. sold was 11200

<u>Explanation:</u>

Given -

Operating income = $28,800

Fixed cost = $38,400

Selling price of one unit = $12

Variable cost = $12

Number of units sold, n = ?

Contribution margin per unit = $18 - $12

= $6

$n = \frac{operating income + fixed cost}{contribution margin per unit}$

$n = \frac{28800 + 38400}{6} \\\\n = \frac{67200}{6} \\\\n = 11200$

Therefore, number of units that Starling Co. sold was 11200

7 0

2 years ago

Heavy Metal Corporation is expected to generate the following free cash flows over the next five years.

mezya [45]

Answer:

Enterprise value of Heavy Metal= $1,080.766

Share price = $18.945 per unit

Explanation:

<em>The value of a firm is the present value of the free cash flow discounted at the weighted average cost of capital</em>

Year PV

1 52.1 × 1.14^(-1) = 45.70175439

2 68.6 × 1.14^(-2) = 52.40073869

3 78.6 × 1.14^(-3) = 53.05276117

4 74.4× 1.14^(-4) = 44.05077264

5 81.1 × 1.14^(-5) = 42.12079868

Year and beyond

81.1 × 1.04/(0.14-0.04) = 843.44

Total value = 45.70+ 52.40+53.052 + 44.050 +42.120+ 843.44 = 1080.766826

Enterprise value of Heavy Metal= $1,080.766

Share price = Total value - Debt value / number of shares

= (1,080.766 - 304 )/ 41 million units= $18.945 per unit

Share price = $18.945 per unit

4 0

3 years ago

Calculating ABC Unit Costs Perkins National Bank has collected the following information for four activities and two types of cr

ELEN [110]

Answer:

The unit cost for classic and gold is $34,96 and $8.35 respectively.

Explanation:

The computation of the unit cost for classic is shown below:

= (Processing transactions × activity rate + Preparing statements × activity rate + Answering questions × activity rate + Providing ATMs × activity rate) ÷ number of holders

= (12,000 × 0.20 + 12,000 × 0.95 + 24,000 × 4.00 + 48,000 × 1.50) ÷ 5,200 holders

= (2,400 + 11,400 + 96,000 + 72,000) ÷ 5,200 holders

= 181,800 ÷ 5,200 holders

= $34.96

The computation of the unit cost for Gold is shown below:

= (Processing transactions × activity rate + Preparing statements × activity rate + Answering questions × activity rate + Providing ATMs × activity rate) ÷ number of holders

= (7,200 × 0.20 + 7,200 × 0.95 + 36,000 × 4.00 + 14,400 × 1.50) ÷ 20,800 holders

= (1,440 + 6,840 + 144,000 + 21,600) ÷ 20,800 holders

= 173,880 ÷ 20,800 holders

= $8.35

5 0

3 years ago

There will be a higher equilibrium price and lower quantity if _____.