Answer:
-1.67
Explanation:
Price elasticity of demand using midpoint method can be formulated as below:
Price elasticity of demand = {(Q_2 - Q_1)/[(Q_2 + Q_1)/2]}/{(P_2 - P_1)/[(P_2 + P_1)/2]}, where:
<em>Q_1 and Q_2 are the volumes before and after price changes;</em>
<em>P_1 is initial price and P_2 is new price.</em>
Putting all the numbers together, we have:
Price elasticity of demand = {(50-100)/[(50+100)/2]}/{(3-2)/([(3+2)/2]} =
- 1.67
Note: Negative sign indicate that when price increases volume will decrease.
Answer:
Using Encryption and also digital certificate technologies
Explanation:
Encryption and digital certificate technologies could be used. The data can be encrypted before transmission. Only the intended recipient of the transmission will be able to decrypt and use it. In addition, digital certification service can also be used to ensure the authenticity of the other party. The standards for processing financial transactions quite strict enough to ensure safeguarding the interests of the card issuer, the cardholder and the merchant.
If the country's money loses its value, people will remove their savings from banks, shift their money into other currencies and purchase investments that are not tied to the country's currency.
Answer:
e) $4,651
Explanation:
The break-even point is the level of activity that a company must operate to have its total cost equal to its total revenue. At this level of activity, the business makes a zero profit, as the total contribution is exactly the same as the total fixed cost.
It is important for the business to have an idea of the number of customers or units of product to sell inorder for it to cover its total fixed cost. This is the information the break-point analysis seeks to provide.
Working it out
Break-point in sales = Total General fixed cost/ Contribution margin ratio
Contribution margin ratio (CMR): Contribution is sales less variable costs. And the contribution margin ratio is the proportion of sales that is earned as contribution. The higher the better.
CMR = contribution/sales
Fixed cost = Contribution + net loss
We can now apply all these relationships to the question given:
Fixed cost = 1720 + 280
= 4,000
Contribution margin ratio = 1720/400 = 43%
Break-even sales ($) = 4000/0.43
= $4,651
