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3 years ago

What is the difference between marginal cost and marginal revenue?

Business

1 answer:

9966 [12]3 years ago

4 0

Answer:

Marginal cost is the money a producer pays for making one more unit, while marginal revenue is the money a producer earns from selling one more unit.

Explanation:

Marginal the word means additional, that now in context of cost refers to additional cost for producing each additional unit.

And Marginal revenue represents additional revenue from selling additional unit.

Thus, additional money paid by the manufacturer or producer for making and manufacturing the additional unit is the marginal cost.

Similarly the marginal revenue is a part of revenue from sale of additional unit by the producer.

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Which of the following is true about duration and modified duration?

My name is Ann [436]

Answer:

The truth about Macaulay Duration and Modified Duration is:

d. All are true.

Explanation:

Principally, the Macaulay Duration, used mainly with immunization strategies, measures the weighted average time an investor holds a bond until the period when the present value of the bond’s cash flows equals to the initial bond amount.

On the other hand, the Modified Duration, providing a risk measure by being sensitive to interest rates, identifies the amount by which the duration changes for each percentage change in the yield and, at the same time, measures how the amount of a change in the interest rates impacts a bond's price.

4 0

3 years ago

A plant asset cost $160000 and is estimated to have a $16000 salvage value at the end of its 4-year useful life. The annual depr

vladimir1956 [14]

Answer:

$20,000

Explanation:

For computing the depreciation expense, first we have to determine the first and second year depreciation which are shown below:

First we have to find the depreciation rate which is shown below:

= One ÷ useful life

= 1 ÷ 4

= 25%

Now the rate is double So, 50%

In year 1, the original cost is $160,000, so the depreciation is $80,000 after applying the 50% depreciation rate

And, in year 2, the $80,000 × 50% = $40,000

The 80,000 is come from = $160,000 - $80,000

And, in year 3, the $40,000 × 50% = $20,000

The 40,000 is come from = $80,000 - $40,000

8 0

3 years ago

Variable costs as a percentage of sales for Lemon Inc. are 80%, current sales are $600,000, and fixed costs are $130,000. How mu

Stels [109]

Answer:

$8000 (increased)

Explanation:

Given:

Current sales = $600,000

Variable cost = 80% of Sales = $600,000 x 80% = $480,000

Fixed cost = $130,000

Computation of current Operating Income :

= Current sales - Variable cost - Fixed cost

= $600,000 - $480,000 - $130,000

Net Income = -$10,000

Computation of Operating Income(After new sales) :

= New sales - New Variable cost - Fixed cost

= ($600,000 + $40,000) - 80% of ($600,000 + $40,000) - $130,000

= $640,000 - $512,000 - $130,000

Net income after new sales = - $2,000

Change in income = Net income after new sales - Net Income before new sales

= -$2,000 - (-$10,000)

= $8000 (increase)

5 0

3 years ago

Burns Corp. had the following items:

OLga [1]

Answer:

Option D is correct because the only item that relates to Income statement is Sales Revenue of $45000 and the remainder transactions net effect must go to Comprehensive Income statement.

Net effect = - $36k + $28k - $17k -$3.1k = $28.1 Loss

This net effect realized during the year in the Comprehensive Income statement because these transaction does not directly relate to core operation of the entity.

7 0

3 years ago

Suppose two athletes each sign 10-year contracts for $80 million. In one case, we’re told that the $80 million will be paid in 1

marusya05 [52]

Answer:

The athlete with equal installments got the better deal.

Explanation:

Two athletes each sign 10-year contracts for $80 million.

In one case, we’re told that the $80 million will be paid in 10 equal installments.

In the other case, the $80 million will be paid in 10 installments, but the installments will increase by 5 percent per year.

The one with equal installments will get $8 million every year.

But the one with increasing installments will get smaller payments initially as his payments were to be increased by 5% each year.

Though the total value of both the annuities will remain the same.

7 0

3 years ago