Answer:
Consider the following explanation
Explanation:
a) J. Crew is issuing its catalogs monthly in response to inflation. This will incur cost and it is known as 'Menu Cost'.
b) Grandpa has bought annuity which has promised $10,000 a year for the rest of his life. However, higher than expected inflation means grandpa has lesser purchasing power. This is loss of purchasing power and also 'redistribution cost'. In higher inflation borrower tends to get benefit. Here insurance company is at the gain.
c) Maria is witnessing loss of purchasing power because of hyper inflation. In such scenario, cost keeps rising and product's price could be higher a few hours later. This was witnessed in Germany as well as in Zimbabwe. People run to the stores as soon as they get cash or salary. It is known as 'shoe leather cost'. People make frequent trips to banks or stores but do not keep cash in fear of losing value.
d) Gita actually earned only 5% on her portfolio but as her income is in taxable bracket so she has to pay 20% tax. Her income from portfolio not even compensated inflation. This is a redistribution cost and also known as fiscal drag. More people fall into bracket because higher nominal income but real income is neglected which makes people worse off.
e) Father thinks that son is earning far more than him but inflation over the period of time erodes purchasing power and it could be possible that current income might be lower, same or higher comparing to inflation data. However, if it is lower then it is obviously loss of purchasing power.
Answer: "structural unemployment".
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Answer:
17%
Explanation:
To calculate this, we use the weighted average cost of capital (WACC) as follows:
Total capital = 15 + 5 = 20
Weight of equity = 15/20 = 0.75, or 75%
Weight of debt = 5/20 = 0.25, or 25%
WACC = (20% × 75%) + (8% × 25%) = 17%
Therefore, the company's cost of capital is 17%.
Answer:
Option (C) is correct.
Explanation:
Manufacturing costs:
= Direct Materials + Direct Labor + Variable overhead
= $160,000 + $80,000 + (150,000 × 75%)
= $160,000 + $80,000 + $112,500
= $352,500
Operating income:
= Sales (1,100 units) - Manufacturing costs
= $370,000 - $352,500
= $17,500
Therefore, if Model A02777 is dropped from the product line, operating income will decrease by $17,500.
Answer:
D. Flex plan ticket books
Explanation:
The selling in which you describe it in such a way that the product is tied in such a way that it improves the customers situation.
e.g All are servers are manufactured in the city so you can be sure of immediate support if any issue arises.
Selling the benefits instead of a features make it easier to get higher prices, it makes the product differentiation easier and justifies the higher price being charged.
The flex tickets are an example of benefit selling because one can purchase it in any combination possible for the type of package purchased and it can be used in any chosen combination throughout the current season.
