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3 years ago

Suppose demand and supply are given by Qd = 60 - P and Qs = 1.0P - 20.

Business

1 answer:

seraphim [82]3 years ago

8 0

Answer:

a. Equilibrium quantity: 40 units; Equilibrium price: $40.

b. Quantity demanded: 10 units; Quantity supplied: 30 units; Surplus: 20 units.

c. Quantity demanded: 9 units; Quantity supplied: 31 units; Shortage: 22 units.

Explanation:

a. The equilibrium quantity occurs when the demanded and supplied quantity are the same, the price for which this situation happens is:

$60 - P = 1.0P - 20.\\2P=80\\P=\$40$

At an equilibrium price of $40, the equilibrium quantity is:

$Q = $40 -20 = 40\ units$

b. At a price of $50, the quantity demanded, the quantity supplied, and the magnitude of the surplus are, respectively:

$Q_d = 60 - P =60-50 =10\ units\\Q_s = 1.0P - 20=50-20 = 30\ units\\Surp = Q_s - Q_d = 30 -10 = 20\ units$

c. At a price of $29, the quantity demanded, the quantity supplied, and the magnitude of the shortage are, respectively:

$Q_d = 60 - P =60-29 =31\ units\\Q_s = 1.0P - 20=29-20 = 9\ units\\Short = Q_d - Q_s = 31 -9 = 22\ units$

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Consider the following financial statements about DANIEL Co. for the current year 2015

neonofarm [45]

Answer:

a. For the Year Ended December 31, 2015

Cash flows from operating activities:

Cash received from customers 15586

Cash paid to suppliers -10260

Cash paid for operating expenses -3910

Cash paid for interest -220

Cash paid for income taxes -560

Net cash flow from operating activities 636

<u>Working: </u>

Sales 16000

Less: Increase in accounts receivable -380

Less: Decrease in unearned revenue -34

Cash received from customers 15586

Cost of goods sold 10000

Add: Decrease in accounts payable 360

Less: Decrease in inventory -100

Cash paid to suppliers 10260

Operating expenses 4000

Less: Noncash expenses

Depreciation expense -150

Impairment loss -200

Cash operating expenses 3650

Add: Increase in prepaid expenses 80

Add: Decrease in accrued liabilities 180

Cash paid for operating expenses 3910

Interest expense 200

Add: Decrease in interest payable 20

Cash paid for interest 220

Income tax expense 600

Less: Increase in income tax payable -40

Cash paid for income taxes 560

(b) Partial Cash Flow Statement (Indirect Method)

For the Year Ended December 31, 2015

Cash flows from operating activities

Net income 1200

Adjustments to reconcile net

income to operating cash flows:

Depreciation expense 150

Impairment loss 200

Increase in accounts receivable -380

Decrease in inventory 100

Increase in prepaid expenses -80

Decrease in accounts payable -360

Decrease in accrued liabilities -180

Decrease in interest payable -20

Decrease in unearned revenue -34

Increase in income tax payable 40 -564

Net cash flow from operating activities 636

4 0

2 years ago

Creme Bakery just paid an annual dividend of $2.20 a share and is expected to increase that amount by 2.2 percent per year. If y

alekssr [168]

Answer:

$19.47

Explanation:

The computation of the price paid for share is shown below:

= Year second dividend ÷ (Required rate of return - growth rate)

where,

Next year dividend is

= $2.20 + $2.20 × 2.2%

= $2.20 + $0.0484

= $2.2484

In the year 2 , it is

= $2.2484 × 1.022

= $2.2978648

And, the required rate of return is 14%

Plus the growth rate is 2.2%

So, the price paid for the share is

= ( $2.2978648) ÷ (14% - 2.2%)

= $19.47

7 0

3 years ago

A stock expects to pay a dividend of $5.49 per share next year. Dividends are expected to grow at 20 percent per year for the fo

navik [9.2K]

Answer:

The annual dividend expected to be paid by the stock nine years from today (D9) is $11.27 per share.

Explanation:

Note: See the attached excel file for the calculations of annual dividends expected to be paid the stock for Years 1 to 9.

In the attached excel file, the following formula is used:

Current year dividend = Previous year dividend * (100% + Growth rate)

From the attached excel file, the annual dividend expected to be paid by the stock nine years from today (D9) is $11.27 per share (Note: see the bold red color under the Year's 9 Current Year Dividend).

Download xlsx

5 0

2 years ago

On October 1st Joe charged $900 to his credit card, on October 10th he charged another $1,300 to his credit card, and on October

poizon [28]

Answer:

interest expense for October $ 27.25

Explanation:

900

+ 1,300 x 20/30

1,816.67 average balance

Now we multiply this average balance by the interest rate of the credit card:

1,816.67 x 0.18/ 12 = 27.25

4 0

2 years ago

Fifteen years ago, Mr. Fairhold paid $50,000 for a single-premium annuity contract. This year, he began receiving a $1,300 month

marusya05 [52]

Answer: $1091.61

Explanation:

From the question, we are told that fifteen years ago, Mr. Fairhold paid $50,000 for a single-premium annuity contract and that this year, he began receiving a $1,300 monthly payment that will continue for his life and based on his age, he can expect to receive $312,000. The amount of each monthly payment is taxable income to Mr. Fairhold goes thus:

Based on the question, Mr Fairhold will have a tax free return of the $50,000 paid. The exclusion ratio will be the investment divided by the expected return. This will be:

= $50,000/$312,000

= 0.1603

Since he received monthly payment of $1,300 and exclusion ratio is 0.1603, the tax free return on investment will be:

= $1,300 × 0.1603

= $208.39

Taxable annuity payment will now be:

= $1300 - $208.39

= $1091.61

6 0

3 years ago