Why does demand become more elastic over time?

A company estimates that an average-risk project has a WACC of 10 percent, a below-average-risk project has a WACC of 8 percent,

prisoha [69]

Answer:

B) Project B has below-average risk and an IRR = 8.5 percent.

Explanation:

Since the evaluation is based on IRR, use IRR rule that says you accept a project if its IRR > Cost of capital(WACC in this case)

Project A's IRR of 9% is < 10% WACC for average risk projects hence reject it.

Project B's IRR of 8.5% is > 8% WACC for below- average risk projects hence accept it.

Project C's IRR of 11% is < 12% WACC for above- average risk projects hence reject it.

8 0

3 years ago

How much profit is this monopolist earning? You may use this formula when solving the question: Profit = Total Revenue − Total C

WITCHER [35]

Answer: $320

Explanation:

The Profit as the question shows is the Total Revenue less the total cost.

Total Revenue.

This will be the amount of goods sold multiplied by the price they are sold at.

The monopolist maximises output where Marginal Revenue equals Marginal Cost which from the graph is 4 units.

The price they sell at is the intersection of this quantity with the demand curve which is at $120.

Total Revenue = Units Sold * Price

= 4 * 120

= $480

Total Cost

The total cost will be the average cost per unit multiplied by the number of units sold. The relevant average cost is the cost associated with the maximised out of 4 units which according to the graph is $40.

= Average cost * number of units

= 40 * 4

= $160

Profit = 480 - 160

= $320

4 0

3 years ago

Investor Palmer has a diversified portfolio consisting of equity and debt valued at $365,000 at the start of the year. During th

garri49 [273]

Answer:

The return after taxes is 7.9%

Explanation:

At the start of the year the portfolio is valued at $365,000.

At the end, his portfolio has returns by dividends ($3,579), interests ($2,783) and portolio's valuation (389,648-365,000=$24,648).

The tax is applied to the dividends and interests, as:

Tax = 0.35 * (3579+2783) = 0.35*6362 = $2,226.70

We can then calculate the investor's return as

R = profit after taxes / initial portfolio valuation

R = ((3579 + 2783 - 2226.70)+24648)/365000

R= 28,783.30 / 365,000 = 0.079 = 7.9%

5 0

3 years ago

An activity-based costing system that is designed for internal decision-making will not conform to generally accepted accounting

Tresset [83]

Answer:

under activity-based costing the sum of all product costs does not equal the total costs of the company.

Explanation:

The method of an activity-based costing system can be used use to find the total cost of all the activities that are required to make a product. This system also helps to find out which overhead costs can be avoided.

An activity-based costing system that is designed for internal decision-making will not conform to generally accepted accounting principles because under activity-based costing the sum of all product costs does not equal the total costs of the company.

8 0

2 years ago

How prevalent is plagiarism on college campuses?

Tatiana [17]

Usually it isn't done much, because of the penalty of bad grades, and because frankly, the professors have seen it before, and therefore, only the boldest would consider it.

3 0

2 years ago