Answer:
The original selling price would be $ 18.99
Explanation:
Given formula is,
M = S - N
Where,
M = markdown,
S = original selling price,
N = reduced price
Here,
M = $ 11.45, N = $ 7.54,
By substituting the values,
11.45 = S - 7.54
⇒ S = 11.45 + 7.54 = 18.99
Hence, the original selling price of the house is $ 18.99
Answer:a. The company will be $11,000 better off over the 5 year period if it replaces the old machine.
Explanation:
The purchase of the new machine will bring the annual operating expenses to $9,000 compared to the $15,000 been spent on the old machine which brings in a savings of $6000 and when this is added to the $ 5000 increase sales revenue from the new machine, it means the company will be better off by $11,000 over the next five year if it replaces the old machine.
There is no justification for being $12,000, $20,000 or $6000 better off over the next five year by either replacing or keeping the old machine.
Answer: a) Eleanor picks Left as Dominant strategy
b) Both pick LEFT at Nash Equilibrium.
Explanation:
The Dominant strategy is that strategy that once embarked on, gives the highest benefit irrespective of what the other player does.
The Dominant strategy therefore is for ELEANOR to pick LEFT. Should Eleanor pick left, they stand a chance to gain 5 if Darnel picks Left as well and 3 if Darnel picks Right. This is better than picking Right because there Eleanor has a chance of a Payoff of 2.
The Nash Equilibrium of a game is the point where both players are at their best alternative meaning that it is beneficial to both of them to remain where they are.
With Eleanor always picking Left, it would be beneficial for Darnel to pick Left as well and make a Payoff of 6 which is the highest they can make with Eleanor picking Left.
The Nash equilibrium in this game is as follows: DARNEL chooses LEFT and ELEANOR chooses LEFT.
Answer:
The company's loss on the contract is $750.
Explanation:
a) Data and Calculations:
Future Contract of 15,000 pounds frozen concentrate:
March 2018 orange juice futures price = 120 cents per pounds
December 2016, the futures price = 140 cents
December 2017, the futures price = 110 cents
February 2018, the futures price = 125 cents
Loss on futures contract = (125 - 120) * 15,000 = $750
b) This futures contract for frozen concentrate is a contract between two parties where both parties agree to sell and buy 15,000 pounds of frozen concentrate at a predetermined price of 120 cents per pound in March 2018, although the contract was entered into in September 2016.
