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Zina [86]
3 years ago
11

When the price of milk goes up, demand does not fall significantly, because people still need to buy milk. However, if the price

of T-bone steaks rises beyond a certain point, people will buy fewer of them because they can turn to the many substitutes for this cut of meat. This refers to price elasticity of demand.
A. True
B. False
Business
1 answer:
Hunter-Best [27]3 years ago
3 0

Answer:

A. True

Explanation:

Price elasticity of demand indicates how the changes in the price of a commodity affect its demand. Price elasticity is a measure of how the demand for a good or responds to changes in prices. Goods or service is said to be price elastic if a small change in price has a substantial effect on the quantities demanded.

A product is price-inelastic when a  change in prices does not have a big impact on its demand. in other words, the demand for that product is not affected by changes in price. Milk is price inelastic as people changes in its price has little effect on demand. People still need milk; a small change in price will not stop them from consuming it.

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Cherokee Inc. is a merchandiser that provided the following information: Number of units sold 20,000 Selling price per unit $ 30
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Add: Purchases..................................................................................180000

Less: Ending Merchandise Inventory...........................................(44000)

Cost of Goods Sold............................................................................160000

Traditional Income Statement

Sales................................................................................................................600000

Less: Cost of Goods Sold..........................................................................(160000)

Gross Profit....................................................................................................440000

Less: Selling and Administrative Expenses

Variable Selling Expense.........................................................80000

Variable Admin Expense............................................................40000

Fixed Selling Expense.................................................................40000

Fixed Admin Expense...................................................................30000

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3 0
3 years ago
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The company is gearing up for next year’s events and determining where to hold them. Customer feedback, logistics, and pricing o
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Answer:

team

Explanation:

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8 0
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When megan purchased several bottles of pepsi beverages and snacks to bring to her family's holiday celebration, it represented
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When Megan purchased the Pepsi beverages and snacks to bring to her family's holiday celebration this represented the purchase of consumer goods. Consumer goods are anything from Pepsi products, to automobiles and refrigerators.
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Feldspar Inc. is considering the capital structure for a new division. Management has been given the following cost information:
34kurt

Answer:

Option 4

Explanation:

In this question ,we have to compute the WACC which is shown below:

= Weightage of debt × cost of debt × ( 1- tax rate) + (Weightage of  common stock) × (cost of common stock)

For Option 1, it would be

= (0.3 × 10%) × ( 1 - 40%) + (0.7 × 12.5%)

= 1.8% + 8.75%

= 10.55%

For Option 2, it would be

= (0.4 × 10.5%) × ( 1 - 40%) + (0.6 × 13%)

= 2.52% + 7.8%

= 10.32%

For Option 3, it would be

= (0.5 × 11%) × ( 1 - 40%) + (0.5 × 13.5%)

= 3.3% + 6.75%

= 10.05%

For Option 4, it would be

= (0.6 × 11.7%) × ( 1 - 40%) + (0.4 × 14.2%)

= 4.212% + 5.68%

= 9.89%

For Option 5, it would be

= (0.7 × 13%) × ( 1 - 40%) + (0.3 × 15.5%)

= 5.46% + 4.65%

= 10.11%

So based on this, the management should accept option 4 as it derives the best debt asset ratio

The weightage of equity would be come

= 1 - weightage of debt

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