Answer:
Price ceiling
Explanation:
When the government imposed a price ceiling in a market of goods which means that price set by the government lies below the equilibrium price of an economy. Price ceiling results in a higher demand for the goods because people wants to buy more quantity of goods at a lower price. But supplier of the goods wants to reduce supply as it will become less profitable for the producers to sell the product at a lower price.
Answer:
1) The transaction cost of both he bank deposit and mutual fund are almost equal as transaction in both can be made by visiting a branch or using internet banking or brokering.
2) The risk for the bank deposits are lower thank mutual funds because even thought the mutual fund is highly diversified, its value can still decline because of changes in market or some market crash like the 2008 recession, where as the money in the bank remains intact
3) The liquidity is higher for bank deposits because money can be withdrawn instantly, whenever the depositor wants, where as the liquidity for mutual funds is a bit lower as it takes a couple of business days to make transactions.
Explanation:
Answer:
Net income from special order = $56,400
Blowing Sand Company should accept the order because it will increase net income by $56,400
Explanation:
In order to carry out an incremental analysis, only relevant cash flows should be considered.
The relevant cash flows from accepting the special order are the variable costs and the sales revenue.
Please, note that the fixed costs are not relevant for this decision. Simply because they would be incurred either way.
1. The sales revenue from the order- $30 × 9400 = $282,000
2. the variable cost of production $24 per unit × 9,400 = $225,600
The contribution from the special order would be determined as follows:
Contribution from special order = sales revenue - variable cost
= $282,000 - $225,600
= $56,400
Blowing Sand Company should accept the order
Answer:
Create an action plan
Explanation:
According to the situation, the company is in the phase of developing an action plan to counter the situation at hand.
They are only done with developing research plan and and creating objectives because that is how they gathered the data on the local competitor who is selling the same toy, but cheaper.
Now, it is time for them to develop an action plan. Once they have implemented the plan, they can go ahead and analyse and interpret the results of the study.
