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juin [17]
3 years ago
10

Sarah is using the needs approach to determine how much life insurance to buy. Her cash needs are $30,000; her income needs are

$140,000; and special needs are $100,000. Sarah has the following assets: $20,000 in bank accounts, $30,000 in retirement plans, and $40,000 in investment accounts. Sarah owns no individual life insurance. She is covered by a $50,000 group life insurance policy through her employer. Based on this information, how much additional life insurance should Sarah purchase? A. $80,000 B. $130,000 C. $150,000 D. $160,000
Business
1 answer:
levacccp [35]3 years ago
3 0

Answer:

$130,000

Explanation:

Sarah is making use of the needs approach to determine how much life insurance to buy

The first step is to calculate the total amount of life insurance

Total amount of life insurance = Total needs - total assets

Total need = income needs + cash needs + special needs

= $140,000 + $30,000 + $100,000

= $270,000

Total assets= retirement plan + bank account + investment account

= $30,000 + $20,000 + $40,000

= $90,000

Total amount of life insurance = $270,000-$90,000

= $180,000

Since Sarah is covered by $50,000 group insurance by her employer then the additional life insurance that should be purchased can be calculated as follows

= $180,000 - $50,000

= $130,000

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Answer:

1. Price elasticity of demand

2 & 3. 4.55%

4 & 5. 22.73%

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8. 15.79%

9. 0.56  

Explanation:

Given that,

Initial quantity demanded = 220

New quantity demanded = 230

Initial price = $4.40

New price = $3.40

1. This illustrates the price elasticity of demand.  Price elasticity of demand is defined as the responsiveness of quantity demanded to any change in the price of the commodity.

2 & 3. Percentage change in quantity demanded:

= [(New quantity demanded - Initial quantity demanded) ÷ Initial quantity demanded] × 100

= [(230 - 220) ÷ 220] × 100

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= 4.55%

4 & 5. Percentage change in price:

= [(New price - Initial price) ÷ Initial price] × 100

= [($3.40 - $4.40) ÷ $4.40] × 100

= 0.2273 × 100

= 22.73%

6. Price elasticity of demand for cereal:

= Percentage change in quantity demanded ÷ Percentage change in price

= 4.55 ÷ 22.73

= 0.2

7. The price elasticity of demand is comes out to be 0.2 which is less than 1, indicates that quantity demanded is less responsive to changes in the price level.

8 & 9. Given that,

Initial quantity demanded = 210

New quantity demanded = 230

Initial price = $4.10

New price = $3.50

Using the mid point method,

Average price:

= (Initial price + New price ) ÷ 2

= ($4.10 + $3.50 ) ÷ 2

= $3.8

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= (New price - Initial price) ÷ Average price

= ($3.50 - $4.10) ÷ $3.8

= 0.1579 or 15.79%

Average quantity demanded:

= (Initial quantity demanded + New quantity demanded ) ÷ 2

= (210 + 230) ÷ 2

= 220

Percentage change in quantity demanded:

= (New quantity demanded - Initial quantity demanded) ÷ Average quantity demanded

= (230 - 210) ÷ 220

= 0.0909 or 9.09%

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= 9.09 ÷ 15.79

= 0.56

7 0
3 years ago
In a dbr​ system, the mechanism that controls the rate at which the bottleneck dictates the throughput of the entire plant is ca
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In a DBR system, the mechanism that controls the speed at which the bottleneck dictates the throughput of the entire plant is called the rope.

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8 0
1 year ago
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Answer: b. supply of cell phones to decrease; the price of cell phones would increase and the quantity of cell phones traded would fall.

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An economic boom is when there's rapid economic expansion which brings about increase in the gross domestic product, higher inflation and lower unemployment.

If economic boom drives up wages for the sales representatives who work for cell phone companies, this will bring about a reduction in the supply of cellphones by the supplier and since there's a decrease, the prices of the available cellphones will increase because there'll be higher demand for lower.goods which invariably shoot up the price and also, the number of cell phones that are being traded will reduce.

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3 years ago
As sales manager, Joe Batista was given the following static budget report for selling expenses in the Clothing Department of So
julsineya [31]

Answer:

SORIA COMPANY

Clothing Department

Flexible Budget Report

For the Month Ended October 31, 2017

See attachment.

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Workings:

1. Sales Commission = $1,680/8,400 x 9,000 = $1,800

2. Advertising = $1,176/8400 x 9,000 = $1,260

3. Travel Expense = $4,032/8,400 x 9,000 = $4,320

4. Free Samples = $1,680/8,400 x 9,000 = $1,800

Explanation:

The flexible budget is one that flexes the activity level or volume in order to recognize changes that may arise.  This changes the base volume of the variable costs.

To achieve this, the value under the static budget is divided by the static budget volume and multiplied by the flexed budget volume(s).

In this case, when the budget was flexed from the static sales volume of 8,400 to 9,000 in accordance with the actual volume achieved, the favorable value was increased from $1,188 to $1,800 more than 50% increase.

The implication is that a flexible budget helps to better evaluate performance than its opposite, the static budget.

Download xlsx
8 0
3 years ago
In a financial sector, we use ______ to construct financial instruments such as derivatives.
Anettt [7]

Answer:

Predictive models

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Predictive modeling uses statistics to predict outcomes. It can be applied to any type of unknown event, regardless of when it occurred.

3 0
3 years ago
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