Answer:
Increase quantity to where AC = MC = D=AR=MR
Explanation:
A perfectly competitive market is where there are many firms in the industry producing homogeneous products. There is ease of entry and exit into and out of the market. They are price takers and earn normal profits in the long-run. In order to maximize profits, a firm in a perfectly competitive industry should produce an the quantity where its average cost is equal to marginal cost when AR = MR = D. In other words, when the AC and MC curves intersect with AR = MR = D curve.
<em><u>Please refer diagram</u></em>
The firm is currently producing at a point where AC > MC at quantity 1000. In order to reach AC = MC, the firm has to increase its quantity to Qe. As it increases quantity, although marginal cost increases, average cost falls because now fixed costs are spread over a larger quantity of output.
At Qe, the three curves intersect and is the point where this firm can maximize its revenue (Price = Pe). At a price higher than this, it would lose customers since there are many others producing the same product and customers can easily shift to another.
Answer:
$2,933
Explanation:
The company had a net income of $8,110, and paid 30% of it to its shareholders, therefore:
$8,110 x 0.30 = $2,433.
But it also repurchased $500 worth of common stock, and this is to be distributed among the sharedholders as well, thus:
$2,433 + $500 = $2,933
Answer:
NPV =$ 60,311.80
Explanation:
<em>The net present value (NPV) of a project is the present value of cash inflow less the present value of cash outflow of the project.</em>
NPV = PV of cash inflow - PV of cash outflow
We can set out the cash flows of the project using the table below:
0 1 2 3
Operating cash flow 136,000 136,000 136,000
Initial cost (274,000)
Working capital (61,000 ) 61,000
Salvage value <u> </u> <u> </u> <u> </u> 1<u>5000 </u>
Net cashflow <u> (335,000) 136,000 136,000 212,000.</u>
PV inflow= (136000)× (1.1)^(-1) + (136,000× (1.1)^(-2) + (112,000)× (1.1)^(-3)
= 395,311.80
NPV =395,311.80 -335,000
=$ 60,311.80
Answer: Stimulus generalization.
Explanation:
Ira is making purchase of Damien soaps based on the Stimulus generalization that the soap would perform in the same way as what she has in mind. Stimulus generalization is when an individual reacts to similar stimuli in similar ways.
Answer:
When Jada is 44 years, the investment will be worth $39,741
Explanation:
time will be 44 - 38 = 6
t = 6 years
compounded every 3 month means 4 times a year (12/3 = 4)
n = 4
r = 7.8%
p = $25,000
