Answer:
c. demanding managerial requirements and limited competitive advantage potential that cross-business strategic fit provides.
Explanation:
An unrelated diversification can be defined as a situation in which an existing business or company enters or invest in an entirely new business or industry that do not have any similarity whatsoever with its original business or product line. For example, an automobile manufacturing company that decides to acquire or invest in a clothing or shoe business.
Hence, the two biggest drawbacks or disadvantages of unrelated diversification are demanding managerial requirements and limited competitive advantage potential that cross-business strategic fit provides.
Also, the difficulties in successfully managing a collection of unrelated different business and having minimal competitive advantage potential over its rivals in the industry that cross-business strategic fit provides is another disadvantage of unrelated diversification
Answer:
1. Neither ; 2. Consumer Surplus ; 3. Producer Surplus
Explanation:
Consumer Surplus is the difference between a good's price paid by consumer, & maximum price the consumer is willing to pay for the good.
Producer Surplus is the difference between a good's price received by a seller, & minimum price at which the seller is willing to sell the good.
1. Willing to pay $209 for watch, buyer willing to sell at $196, no trade as price ceiling at $190 : It illustrates neither concept as transaction has not actually occurred, so no price established.
2. Willing to pay $39 for sweater, purchased it for $32 : It illustrates 'Consumer Surplus' case = $7 , as it shows difference between maximum willingness to pay by buyer ($39) & the actual buy price ($32)
3. Willing to sell laptop at $190, sold it at $199 : It illustrates 'Producer Surplus' case = $9 , as it shows difference between minimum willingness to sell price ($190) & actual sale price ($199)
Answer:
Annual depreciation= $77,000
Explanation:
Giving the following information:
Purchase price= $800,000
Salvage value= $30,000
Useful life= 10 year
Under the straight-line method of depreciation, the depreciation expense is constant along the useful life.
We need to use the following formula:
Annual depreciation= (original cost - salvage value)/estimated life (years)
Annual depreciation= (800,000 - 30,000)/10
Annual depreciation= $77,000
Answer:
The 125,000 shares of common stock would be issued
Explanation:
For computing how many shares of common stock would be issued, we have to use the formula of common share produced which is shown below:
Common share produced = Par value ÷ Conversion price
where,
Par value is $5,000,000
And, the conversion is $40
Now, apply these values to the above formula
So, the value would be equals to
= $5,000,000 ÷ $40
= 125,000
The time period and rate of debentures is irrelevant, Thus, it is ignored.
Hence, the 125,000 shares of common stock would be issued.
Answer:
a.67.9%.
Explanation:
Debt to Total Assets Ratio = Total Liabilities / Total Assets x 100
<em>Total Liabilities = $95,000,000
</em>
<em>Total Assets = $140,000,000
</em>
Debt to Total Assets Ratio = $95,000,000 / $140,000,000 x 100
Debt to Total Assets Ratio = 0.679 x 100
or
Debt to Total Assets Ratio = 67.9%
Hence, The Assets of Marker Co. are 67.9% funded by creditors.
