Answer:
False
Explanation:
fixed assets turnover ratio = net sales / average fixed assets
This ration measures how effectively a company uses its fixed assets to generate sales. If a company's fixed assets turnover ratio is higher than the industry average, it means that it is using its assets more efficiently to generate more sales or it is working at an over capacity, and it needs to add more fixed assets.
a. 50 cents
Contribution margin per unit is price per unit- variable cost per unit
1.75 - ($50,000/40,000 units)
1.75 - 1.25 = $ .50
b. $8750
Margin of safety is the expected sales - break even sales
(45,000 units * $1.75 per unit) - (40,000 *1.75)
78,750 - 70,000 = $8750
Answer:1. Increase in supply; increase; decrease
2. Decrease in supply; decrease; increase
3. Increase in supply; increase; decrease
4. Decrease in quantity supplied; decrease; decrease
Explanation:
Answer:
Equilibrium price = Decreases
Equilibrium quantity = Indeterminate
Explanation:
Here, we suppose that tea and coffee are substitute goods and we know that substitute goods have a positive cross price elasticity of demand.
So, if there is a fall in the price of tea then as a result the demand for coffee decreases which shifts the demand curve of coffee leftwards.
And, there is a fall in the price of coffee beans due to the better weather condition and coffee beans are used as an ingredient for producing coffee.
Hence, there is a fall in the cost of production of coffee which increases the supply of coffee and shifts the supply curve of coffee rightwards.
Therefore, there is a fall in the equilibrium price level of coffee and the effect of these shifts on the equilibrium quantity is indeterminate because that will be dependent upon the magnitude of the shifts of both the curves.
