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zaharov [31]
3 years ago
6

Suppose there exists a market for coffee that is in equilibrium at 500 cups brewed per week for $3/cup. Now suppose the demand f

or coffee shifts outward (to the right). What are some reasons this shift might have occurred?
Business
1 answer:
Anton [14]3 years ago
7 0

Answer:

Increase in Substitute good price , Decrease in Complementary Good price, Fall in Income , Taste & preferences change in favour of good.

Explanation:

Demand is the ability & willingness of consumer to buy a product at a price , period of time.

There are four factors affecting Demand with following relationships with it : Price of Good (inversely related) , Price of related goods (substitutes-directly related) & (complements-inversely related), Income (directly related) , Taste & preferences (depends).

Any Change in 'Quantity Demanded' due to change in good's own price leads to movement on the demand curve (contraction or expansion). Any 'Change in Demand' due to factors other than price shifts the demand curve (rightwards or leftwards).

So : Increase in substitute good's price (eg- tea) price makes coffee relatively cheaper, Decrease in complementary good's price (eg - sugar/milk) makes coffee altogether cheaper, taste & preference change in favour of coffee consumption (eg- people learning advantages of caffaine consumption). All these mentioned Increase the Demand for coffee & shifts its curve rightwards.

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1. Why do firms choose to make large increases in their dividends or start a stock repurchase program?2. Why do firms choose to
sergij07 [2.7K]

Answer with Explanation:

Requirement 1:

The companies whose products are in growth phase or the company is cash cow which has a well diversified products does not have to invest in adding a new product line because their earnings are already stable enough or that they don't have to invest much because sufficient profits are left after extracting for investments. Increase in dividends has two meanings that either the management is confident enough that they think that the company will be able to earn more in the future and they will achieve better position in future which is a good news in the stock exchange and for investors as well and investor invest more in the company's ordinary stock.

Company start Stock repurchase program which is to buyback its previously issued ordinary shares which is because the management thinks that the stock is undervalued and thus they repurchase their ordinary shares so that the stock will go up in near future and this will benefit the company and the existing shareholders as well. This also helps in increasing earnings per share, return on equity, etc because the equity is reduced by share repurchase program.

Stock repurchase program is also run by the organization because they don't find any attractive opportunities. This means that the company does not have any large investment opportunities which means growth in revenue and profit can not be expected in the future years. Thus when the company starts repurchasing of stock the investor starts selling their stocks.

Requirement 2:

If the company thinks that they can increase the worth of shareholders beyond their shareholder's expectation then they don't pay dividend and invest in projects to increase the sales growth, profits and market share significantly in the coming future.

Some long term shareholders think this is a great news whereas short term investors who are looking for dividends will sell the stock which means that the stock value may fall in near future but in long run the company stock value increase when the investment will start showing its results.

8 0
3 years ago
Jamesway Corporation has two separate divisions that operate as profit centers. The following information is available for the m
Nookie1986 [14]

Answer:

White Division Gross Profit  = $72,200

Grey Division Gross Profit =  $247,700

Explanation:

                                                     White Division    Grey division

Sales (net)                                      $270,000            $540,000

Less: Cost of goods sold              <u> $135,000  </u>          <u>$202,500</u>

Gross Margin                                 $135,000             $337,500

Less: Salary Expenses                   $37,800              $64,800

Rent                                                 <u>$25,000</u>              <u>$25,000</u>

Gross Profit                                   <u> $72,200 </u>             <u>$247,700</u>

The White Division occupies 25,000 square feet in the plant. The Grey Division occupies 25,000 square feet. Hence, the rent expenses will be shared equally. Rent = $50,000 hence, both division will pay $25,000 each              for rent

7 0
3 years ago
Define a strong dollar?
lora16 [44]

Answer:

A strong dollar occurs when the U.S. dollar has risen to a level against another currency that is near historically high exchange rates for the other currency relative to the dollar.

Explanation:

3 0
3 years ago
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8 0
3 years ago
Changes in inventories are included as part of investment spending because multiple choice 1 anything produced by a business tha
Nataly_w [17]

Answer:

A)Changes in inventories are included as part of investment spending because anything produced by a business that has Anything produced by a business that has not been sold during the accounting period is something in which the business has invested

B)If inventories declined by $1 billion during 2012, then $1 billion would be subtracted from both gross private domestic investment and gross domestic product.

Explanation:

A) All inventories that Businesses could have is expected to be utilized by the business. Example of this is that Iron sheet that a business could use in making new Factory building or a pack of toiletries in the shelf in supermarket are both asset as regards to the business and they are things that are been invested by the business.

B)Declination in inventories symbolize that produced goods in previous years has been used up in production of current year. In the case that that the stated $1 billion is not deducted, then there would be need to count the produced goods that was produced in previous year as been produced in 2022

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2 years ago
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