Answer:
b. Firm A engaged in predatory pricing.
Explanation:
Since Firm A and B are the only two companies that sell mail-order DVD rental subscriptions.
Firm A decided to price its subscriptions below average variable cost thereby causing Firm B to also sell subscriptions below average variable cost, but they went bankrupt and exited the market. Firm A then raised prices by 40% and is currently earning large, positive economic profits.
Based on this information only, an argument can be made that Firm A engaged in predatory pricing.
Predatory pricing is a marketing or pricing strategy that involves lowering the cost of goods and services for a short-term, in order to lure competing firms to lower their price, thus causing them to go bankrupt and exiting from the market.
Answer:
Common Stock $10,000 and Paid-in Capital in Excess of Par Value $2,000
Explanation:
The journal entry to record the issuance of common stock is presented below:
Cash A/c Dr $12,000 (1,000 shares × $12)
To Common Stock $10,000 ($1,000-× $10)
To Additional Paid-in Capital in excess of par - Common Stock $2,000
(Being the issuance of stock is reported and the remaining balance i.e $2,000 is credited to the additional paid-in capital account)
While issuing the stock, we debited the cash account as there is a cash inflow and credited the common stock and additional paid-in capital account as the share is issued which affect the stockholder equity
Answer:
a.
Explanation:
Every customer matters, not only should a company focus on her seemingly high-value customers but also on their seemingly low-value customers.
Hence to ensure the retention of their customers and not lose them to competitors, the company should use the customers' data record to provide special retention offers for them to continue as customers.
Every dollar counts, and no customer can be said to remain forever or leave soon, therefore each of these customers should be treated equally to maximize profit for the company both now and in the long run.
The court will most likely consider the parties' relative bargaining power.
<u>Option: C</u>
<u>Explanation:</u>
Bargaining power is the collective ability of groups to put control over one another in a circumstance. If all sides are in a dispute on an equivalent basis, then they would have equal bargaining power, such as in a reasonably free market, or between a monopoly and monopsony fairly balanced.
Purchaser bargaining power relates to the leverage customers may impose on businesses to get them to offer higher quality goods, improved customer satisfaction and lower costs. A powerful purchaser will make a market more profitable and diminish the seller's profit potential.
Answer:
Total Return on investment=12.678%≅12.68%
Explanation:
Given;
Number of Shares= 300
Purchasing price of each share=$32.60
Total Dividends= $280
Selling price of each share= $35.80
Find:
Total Return on investment=?
Solution:
Total Return on investment=
Total Return on investment=0.12678
In Percentage:
Total Return on investment=12.678%≅12.68%
