Answer: Variable ... Fixed
Explanation:
In the short run, Variable Inputs or costs are known as those which can be changed and their quantities can be varied. In this scenario, the employees that Cho's uses can be varied and so are the Variable Inputs.
Similarly, those costs that cann ot be changed or varied in the short run are rightly known as Fixed Inputs. Cho's Kitchen cannot take more than 3 ovens and also she has already signed a lease for them. These costs cannot be changed and so make the oven a Fixed Input.
It is worthy of note that in the long term, all Costs are considered Variable.
Answer:
r or expected rate of return - market = 0.14 or 14%
r or expected rate of return - stock = 0.2120 or 21.20%
Explanation:
Using the CAPM, we can calculate the required/expected rate of return on a stock. This is the minimum return required by the investors to invest in a stock based on its systematic risk, the market's risk premium and the risk free rate.
The formula for required rate of return under CAPM is,
r = rRF + Beta * rpM
Where,
- rRF is the risk free rate
- rpM is the market risk premium
Under CAPM, the assumption follows that the beta of the market is always equal to 1.
So, expected return on the stock market will be,
r or expected rate of return - market = 0.06 + 1 * 0.08
r or expected rate of return - market = 0.14 or 14%
The beta of the stock is given. We calculate the required rate of return on the stock to be,
r or expected rate of return - stock = 0.06 + 1.9 * 0.08
r or expected rate of return - stock = 0.2120 or 21.20%
Answer: $918,000
Explanation: Since Shelton Co is considering building a warehouse on the site because the rental lease is expiring then in evaluating the new project all the relevant cash flows must be considered in the protect evaluation. Market value of the land used for constructing the building is an opportunity cash flow and so must be considered. The Relevant cost of opportunity for land will be its fair value.
Therefore ,the initial cost cost of the warehouse project for the use of this land is $918, 000.
The answer is : Producers respond by supplying more bread
When shortage of breads increases, the demand of the product will jump through the roof, which will also increase its price
To gain the maximum profit, the producers will respond by supplying more bread until the shortage is eliminated
