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brilliants [131]
3 years ago
12

Looking to increase the profits of his lemonade stand, Johann doubled the price of a cup of lemonade from 25 cents to 50 cents.

This clearly shows Johann’s lack of business sense, for now he’ll almost certainly sell fewer cups at the new price and therefore make less money than before.The argument above assumes that 1. Johann is looking to double the profits of his lemonade stand2. the price increase will likely put Johann out of business3. profits from the price increase will not offset the money lost when fewer cups are sold4. even if Johann sells more cups at the new price than he did at the old price, he’ll still lose money on the lemonade stand
Business
1 answer:
hjlf3 years ago
7 0

Answer:

<u>1. Johann is looking to double the profits of his lemonade stand</u>

Explanation:

Note that Johann was<em> still making m</em>oney from lemonade stand but was not content with the profits he was making that was his argument or reason for increasing the price of a cup of lemonade from 25 cents to 50 cents.

<em>Without having forsight</em> Johann's decision eventually resulted in him selling fewer cups at the new price and therefore making less money than before.

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The balance sheet of Innovative Products reports total assets of $570,000 and $770,000 at the beginning and end of the year, res
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Answer:

$201,000

Explanation:

The computation of net cash flows from operating activities is shown below:-

Beginning Total Assets            $570,000

Ending total assets                   $770,000

Average Total Assets in use    $670,000

($570,000 + $770,000) ÷ 2

Cash return on Asset                    30%

Cash Flow from operating activities  

Average Assets × 25%               $201,000

($670,000 × 25%)

Therefore the Cash Flow from operating activities is $201,000

6 0
2 years ago
Item 15Item 15 Gee-Gee's is going to pay an annual dividend of $2.05 a share next year. This year, the company paid a dividend o
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Answer:

$27.33

Explanation:

For computing the one share of the common stock after six years from now first, we have to determine the price of the common stock which is shown below

Price of the common stock = Next year dividend ÷ (Required rate of return - growth rate)

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Now the one share of the common stock after six years is

= $2 × 1.025^7 ÷ (11.2% - 2.50%)

= 2.3773715073  ÷ 8.7%

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