Answer:
The answer is $1357.85
Explanation:
Future value= Σ C(1+i)^n
FV = 116(1.141^3) + 135( 1.141^2) + 885(1.141) = $1357.85
Answer:
an increase in the operating income by $16,322
Explanation:
The computation of the impact in the operating income is given below:
Variable cost of 75 units (1300000 × 75 ÷ 12700) 7,678
Sale price of 75 units (75 × 320) 24,000
Increase in operating income (24000 - 7678) $16,322
hence, the impact in the operating income is that there is an increase in the operating income by $16,322
Answer: a.$275,000
Explanation:
Let us assume local production sales of 0 for simplicity of analysis.
At 0 there will be no Variable Costs and no fixed costs because they are dependant on the amount of units produced.
If then Rylan Corporation receives 25,000 units at $16 per unit this will change the Variable costs as it will have to incorporate the new units.
The question however says that normal production continues. This means that Fixed costs do not change. That means fixed costs remain at $0.
That means the only change will be the Variable costs of selling 25,000 units.
At a rate of $11 per unit we then have,
= 11 * 25,000
= $275,000
The costs have increased by $275,000 from 0 which means that $275,000 is the Incremental cost.
Note that Fixed and Variable costs of 0 are improbable and we're only used for simpler analysis. Feel free to try the question with other number of units for your own practice. You will arrive at the same answer regardless.
Answer:
The answer is: D) The quotation is incorrect: A decrease in price causes a decrease in quantity supplied, not a decrease in supply.
Explanation:
A decrease in the price of a product or service will always decrease the quantity supplied and increase the quantity demanded of the product. The terms supply and demand apply to the entire curve, not an specific point in them.
For example, the equilibrium point for milk is 5 million gallons sold at $3 each. If the government suddenly decides that it will place a price ceiling for milk at $2 per gallon (may use argument that it is a necessity good essential for the well being of children) the quantity demanded for milk will rise but the quantity supplied will fall.
That is because not every dairy business will be able to produce and sell milk at $2 and still make a profit (or meet their expected profit levels), so they will either lower their milk production (make substitute products) or go out of business.
Price ceiling are measure employed by government to help the consumers by mandating a maximum price that the seller must charge for a product or service.
- The measure of imposing price in market are rare but are notably used during natural disasters.
- Price ceiling helps to prevent the producers from exploiting the consumers.
In conclusion, the major disadvantage of price ceiling is that when a price ceiling is set below the equilibrium price, the quantity demanded will exceed quantity supplied, thus, this will result to excess demand of goods and shortage in the market.
Learn more about Price ceiling here
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