Answer:
The best example I can think of that would integrate all of these concepts is when a business is looking to finance some sort of project and they are seeking financing either through the issuance of bonds or a loan from a bank. Some of the concepts would be important to both parties, while others would be more important to one than the other.
Cash Flow
This would be important to both parties. The business, to make sure they have enough cash flow to pay for the financing. And the financiers, for the same reason.
Ratio Analysis
This would be important to both parties for the same reason as above. Especially the "current ratio" (current assets / current liabilities) and the "working capital" ratio (current assets - current liabilities).
Financial Statements
This would be of most importance to the financiers. They would want to see the total picture of a company's financial strength.
Time Value of Money
This would be of most importance to the company itself. They would want to know if the project was worth the total amount they would be paying on the bonds or the loan
The correct answer is: "I would recommend her not to increase the price, because with an elastic demand function this will cause a great decrease in the quantity demanded by consumers".
The demand function represents the quantity of a certain good or service that consumers are willing to purchase in the market at different price levels. The law of demand states that there is an inverse relationship between price and quantity demanded (ceteris paribus, hence, given that the rest remains equal). <u>Therefore, when the price charged decreases, the amount that consumers are willing to purchase increases. </u>
In turn, the elasticity of the demand function measures the sensitiveness of the quantity demanded by consumers when there is a certain price change. If the demand function is elastic it means that a price variation would generate an even larger variation (in the inverse direction of course!) in the quantity demanded. <u>This is the case of the lemonade stand therefore the girl should not increase prices because this will not help her to reach her objective quicke</u>r, as she would loss a greater proportion of units sold than the size of the price increase that would have allowed her to earn more per unit.
Answer:
2.09
Explanation:
Asset ratio is a business tool used to measure the efficiency of assets towards sales generation by comparing net sales to average total assets.
It is calculated by dividing the net sales by average total assets.
The average total assets is used in order to make allowance for fluctuation in the course of business year
<u>Workings</u>
Net sales = $217550
Opening total asset = $94200
Closing Total assets = $ 113500
Asset ratio turnover = 217550/(94200+113500)/2
=2.09
The question is asking to states when is it not necessary to build a new market supply schedule and base on my research and further understanding, I would say that the answer would be when there's no demand or when there's a huge surplus. I hope you are satisfied with my answer and feel free to ask for more
