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White raven [17]
3 years ago
14

Sid has decided to leave his $70,000-a-year landscape design job and open a new kayak business. His insurance cost is expected t

o be $2,000 per year. The kayaks he owns are valued at $25,000, but he experiences 10% annual depreciation on them. He will also use building space that he owns, but, to do so, he must give up the $10,000 per year in rent he used to receive for the space. Revenue is expected to equal $100,000 per year. Sid's economic profit is: $2,000 $15,500 $84,500 $82,500
Business
1 answer:
madreJ [45]3 years ago
7 0

Answer:

The correct answer is $15,500.

Explanation:

According to the scenario, the computation of the given data are as follows:

Revenue = $100,000

Insurance cost = $2,000

Design job leave = $70,000

Rent = $10,000

Annual depreciation = 10% × $25,000 = $2,500

So, we can calculate the economic profit by using following formula:

Economic Profit = Total Revenue - (Explicit cost + Implicit costs)

By putting the value, we get

= $100,000-($70,000 + $2,000 + $10,000 + $2,500)

= $15,500

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The salesperson who is responsible for ongoing business with a customer who uses a product, satisfying their long-term needs and
yan [13]

Answer: Account manager

Explanation: The account manager is that salesman of a company who is responsible for managing sales and relationship with particular customers of the company. The account manager is assigned accounts of customers of which he has to maintain relationships with.

The main focus of account manager is to manage sales with customers and identify new business opportunities if any.

Thus, Account manager is the right answer for the given case.

5 0
3 years ago
If a household's income rises by 30%, its budget constraint will A) shift out parallel to the old one. B) pivot at the Y-interce
aliina [53]

Answer:

A

Explanation:

A budget constraint is a graph that shows all the combination of goods a consumer can consume given  current prices and income of the consumer.

If income increases, the budget constraint will  shift out parallel to the old

If income decreases, budget constraint will  shift in parallel to the old one.

6 0
3 years ago
Assume that you would like to purchase 100 shares of preferred stock that pays an annual dividend of $6.00 per share. However, y
butalik [34]

Answer:

$267.1211

Explanation:

return on preference share per unit is $6  , thus at 12% annual rate of return. Initial value of preference shares will be $50 per unit ( $6 divided by 12%).

Total value of preference shares = $50 multiplied by 100 preference shares = $5000

Future value of preference shares = 5000 (1.12)^5  = $8,811.7084

to find the value of money to be deposited to be able to buy the preference shares at the end of 5 yrs.

we work back to get the present value using the mutual fund annual rate

$8811.7084 = pv (1.06)^60  the rate is compounded monthly. Hence we shall compound the return 60 times in 5 years

Bank account money = 8811.7084  divided by 32.9877 = $267.1211

5 0
3 years ago
What is the difference between training and development?...
gtnhenbr [62]
Training is working hard and development is getting better
6 0
3 years ago
Read 2 more answers
Alpha Company is looking at two different capital​ structures, one an​ all-equity firm and the other a levered firm with ​$4.6 m
Aleks [24]

Answer:

The break-even EBIT using EPS is $1,288,000.

Explanation:

the break-even EBIT using EPS is the EBIT that will brings EPS under two different capital structure equal.

Denot X is the EBIT.

* We have:

+ EPS in all-equity firm = X/460,000

+ EPS in levered firm = ( X - interest rate)/230,000 = ( X - 4,600,000 x 14%)/230,000 = (X - 644,000) / 230,000.

* We have the equation:

X/460,000 = (X-644,000)/230,000 <=> X/460,000 = 2.8 <=> X = $1,288,000.

So, the break-even EBIT using EPS is $1,288,000.

8 0
3 years ago
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