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3 years ago

A decrease in supply will cause the smallest increase in price when

Business

1 answer:

andre [41]3 years ago

6 0

Answer:

Both supply and demand are elastic.

Explanation:

Demand or supply elasticity is defined as elasticity or responsiveness with more than one numerical value, which indicates their high response to the change in price.

Elastic demand: It is the percentage change in quantity demanded due to the change in price in absolute value of the product.

The elasticity of supply: It is defined as the response of the quantity of a good supplied to a change in the price of the good. Likely to be positive in output.

FORMULA; Elasticity of supply= $(\%\ change\ in\ quantity\ supplied) / (\%\ change\ in\ price)$

Due to the decrease in the supply of goods in the market, it leads to the scarcity of goods, therefore there is an increase in the price of goods.

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Consider a fast food café of your choice. Apply 4 V’s of Operation. Describe each V as ‘High’, ‘Low’ or ‘Moderate’ with one line

Marrrta [24]

Answer:

4 V's of Operation

The 4 V's of operation are Volume, Variety, Variation, and Visibility. Let us take Mrs. Happy Food Cafe with over 100 outlets in Fiacton Town, as an example to illustrate the 4 V's of operation.

Volume: As a food cafe, the volume of production that will be required for some foods and drinks is so high that their provision requires repetitive tasks. Based on this, procedures are normally standardized in order to achieve low cost for foods and drinks. However, it is harder to standardize services, since personal touches are added by the servers based on their individual perceptions and abilities.

Variety: Mrs. Happy Food Cafe tries to bring some variety in her offerings to satisfy the various needs of her customers. While variety is naturally low in the Food Cafe sector, some cafes like Mrs. Happy Good Cafe, try to satisfy customers' demands by varying the foods with Continental, African, Latino cuisines and dishes.

Variation: At Mrs Happy Food cafes, the food and drinks do not vary much as customers expect to be served the same quality of services at any of their cafes. This is because the processes are standardized to achieve low cost. So, the variation is moderate.

Visibility: Customers of Mrs Happy Food cafes are not able to see and track their experiences of the the processes for the food preparation that they order. But, they can track the processes for the services because services are consumed as they are offered. So, visibility is 'Moderate," as it is divided between the hard goods and the soft goods. With respect to goods visibility is 'Low.' However, with respect to the services the customers' visibility of processes is high.

Explanation:

The 4 V's of operation describe the different characteristics of the processes that various entities use to transform their inputs into outputs of goods and services. They may be high, low, or moderate. They include, volume, variety, variation, and visibility.

7 0

3 years ago

According to the FASB’s conceptual framework, the quality of information that enables users to identify similarities in and diff

ehidna [41]

Answer:

A) Comparability.

Explanation:

According to FASB, the objective of financial reporting is to provide information that is useful to existing and potential investors or creditors. One of the main uses given to financial reports is comparing one business to another. In order for the reports to be comparable, they must follow strict standards and be properly prepared.

If the reports aren't comparable, they use is extremely limited, since how else can you decide if investing in company A is a better idea than investing in company B. Comparability applies even to the same company, since you must be able to compare the financial results of different years in order to evaluate the performance of the company.

6 0

4 years ago

The Zoom button is located on the Review tab. TRUE OR FALSE

Elena L [17]

Your answer is false :)

7 0

4 years ago

Read 2 more answers

Mimi Company is considering a capital investment of $275,000 in new equipment. The equipment is expected to have a 5-year useful

SIZIF [17.4K]

Answer:

Payback Period: 11 Years

Net Present Value: $123,055

Profitability Index: 0.45

Internal rate of return: 53.48%

Annual rate of return: 38.18%

Explanation:

Payback Period:

The Cash Payback Period can be calculated from the following formula, when the cash inflows are even Cash flows:

Payback Period = Investment / Even Cash flow

Here total annual even cash flow = $25,000 + $80,000 = $105,000

By putting values, we have:

Payback Period = $275,000 / $25,000 = 11 Years

Net Present Value:

As we know:

Net present Value = Present Value of Cash inflow - Present Value of Cash Outflow

Here

Present Value of Cash Inflow = Even Cash flow * Annuity Factor

By putting values:

Present Value of Cash Inflow = $105,000 * 3.791 = $398,055

Now Present value of cash outflow which is investment will the same because the money is invested in the year zero.

Which means:

Net present Value = $398,055 - 275,000 = $123,055

Profitability Index:

The profitability Index can be calculated using the following formula:

PI = NPV / Investment

So by putting values, we have:

PI = $123,055 / $275,000 = 0.45

Internal rate of return:

At 10%, NPV is $123,055 so all we have to do is to use a higher cost of capital to find using the formula at the end, the breakeven rate of return at which NPV is zero.

So I choose 20%.

At 20%, annuity factor is 2.990 which is approximately 3.

NPV = $125,000 * 3 - $275,000 = $100,000

By putting values in the following formula:

IRR = Lower Percentage + (Higher percentage - Lower percentage) * (NPV at Higher Percentage) / (NPV at lower - NPV at higher)

By putting values, we have:

IRR = 10% + (20% - 10%) * ($100,000) / ($123000 - $100,000)

IRR = 10% + 10% * 4.348 = 53.48%

Annual rate of return:

Annual rate of return can be calculated using the following formula:

Annual rate of return = Earnings Before Interest and tax / Investment

Here

Earnings before interest and tax is $105,000

So by putting formula, we have:

Annual rate of return = $105,000 / $275,000 = 38.18%

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4 years ago

A master plan is devised for

Georgia [21]

A master plan is devised for long-range goals

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4 years ago