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sasho [114]
3 years ago
13

Firms in the patented pharmaceutical industry earned an average return on net worth of 22 percent in 2006, compared with an aver

age return of 14 percent earned by over 1,400 firms followed by Value Line . Which theory or theories of profit do you think best explain(s) the performance of the drug industry
Business
1 answer:
IrinaVladis [17]3 years ago
3 0

Answer and Explanation:

The following theories of profit best explain the profits of pharma companies:

1. Risk bearing - The theory says the higher the risk, the higher the rewards. The pharma companies take huge risks in inventing a new drug, having trials and the getting FDA approvals.

2. Monopoly - If a new drug is approved, the pharma company gets a patent over it, which means that it will have an effective monopoly on that segment of the market.

3. Innovation - it states that innovation is what keeps a company ahead. And pharma industry is built on innovation. Pharma companies have to continuously find new drugs because once patents run out on existing drugs, there are no profits to be made.

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Provide an example that shows variable costing is divided among different activities, and that each activity has its own predete
denis23 [38]

Answer:

Variable Expense - Cost driver

Machine setup cost - Number of Setups

Machine running cost - Machine hours used

Ordering Cost - No of orders placed

Labor Cost - Labor hours worked

Raw Material - Material usage rate

Transportation Cost - No of Orders delivered.

Explanation:

An organizational structure in one in which certain activities are aligned to achieve the ultimate goal of the organization. Similar types of set of machines together to get particular output product. The cost drivers in organizational structure can influence the output of a company.To determine the product cost per unit using the absorption costing we find the per unit rate for Variable Overheads for the activity by diving the total variable cost by its cost driver.

7 0
3 years ago
Which country use tax brackets as a part of their tax system
konstantin123 [22]
Canada, Australia, and South Africa use tax brackets.
8 0
3 years ago
Read 2 more answers
Problem 5-30 Graphing; Incremental Analysis; Operating Leverage [LO5-2, LO5-4, LO5-5, LO5-6, LO5-8][The following information ap
WARRIOR [948]

Answer:

Break Even Point

In Units = 2,000 units

In value = $80,000

Explanation:

Break even Point = \frac{Fixed\ Cost}{Contribution}

When we use contribution per unit, we get the break even point in units sales.

When we use the contribution margin as a percentage of sales we get break even sales in value.

Contribution per unit = $20

Contribution margin in percentage = $20/$40 = 50%

Therefore, Break even Point in units = \frac{40,000}{20} = 2,000

Break even units = 2,000

Break Even Point in value = \frac{40,000}{0.50} = 80,000

Sales to be made in value at break even = $80,000

8 0
3 years ago
In economics, another term for satisfaction is marginal productivity. income elasticity. utility. price elasticity.
Feliz [49]

Answer:

Utility

Explanation:

Utility is an economic term used to represent satisfaction or happiness. Marginal utility is the incremental increase in utility that results from consumption of one additional unit.

3 0
3 years ago
Light emitting diodes (LED) light bulbs have become required in recent years, but do they make financial sense? Suppose a typica
tangare [24]

Answer:

Annual wattage cost of 60 watts is $3.729

Annual LED cost of 60 watts is $0.185

total annual cost = $3.914

Annual wattage cost of 15 watts is $0.935

Annual LED cost of 15 watts is $0.125

total annual cost = $1.06

l

Explanation:

For the cost of LED and durability

it is require to use a light fixture 500 hours per year

60-watt incandescent light bulb costs $.37 and lasts 1,000 hours. that mean, its last for 2years before buying a new one.

And for a 15-watt LED,  costs $3.00 and lasts for 12,000 hours, thats means it will last for 24 years before purchase of another.

assuming, will are using the 60watts for 24years, a cost of  $.37*12times = $4.44 will be use for buying.

therefore, a 15 watts LED is more cheaper.

For the current charges of LED

for 60watts

if A kilowatt-hour of electricity costs $.113 =

1000 watts = 1hour = $0.113

60 watts  = 1hour  = (60*0.133/1000) = $0.0068

it is said that, the consumption is for 500 hour per year.

therefore, 60watts used per year = 500*0.0068 = $3.39

return of 10% =0.339.

total cost of watts for 500hr for a year = 3.39+0.339 = $3.729

Annual wattage cost of 60 watts is $3.729

Annual LED cost of 60 watts ($0.37/2year) is $0.185

total annual cost = $3.914

for 15 watts

if A kilowatt-hour of electricity costs $.113 =

1000 watts = 1hour = $0.113

15 watts  = 1hour  = (15*0.133/1000) = $0.0017

it is said that, the consumption is for 500 hour per year.

therefore, 15 watts used per year = 500*0.0017 = $0.85

return of 10% =0.085.

total cost of watts for 500hr for a year = 0.85+0.085 = $0.935

Annual wattage cost of 15 watts is $0.935

Annual LED cost of 15 watts ($3/24 years) is $0.125

total annual cost = $1.06

6 0
3 years ago
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