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3 years ago

Value can be increased by increasing perceived benefits while holding price or cost constant. Question 11 options: TRUE FALSE

Business

1 answer:

skad [1K]3 years ago

7 0

Answer:

True

Explanation:

Value is the perception of the benefits or utility associated to consuming a good or a service in relation to the price of that good or service. This basically refers to consumer surplus, how much are consumers willing to pay for a good or service vs the actual cost of the good or service. If you increase the perceived benefits, then our consumers will value our goods or services more and this would increase their consumer surplus.

Consumers are the ones that ultimately will decide the value of our goods or services, and if they assign us a higher perceived value, they will be willing to pay a higher price for them.

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An investor estimates that next year's sales for Dursley's Hotels Inc. should amount to about $100 million. The company has 5

Lerok [7]

Answer:

(a) $10 million

(b) $1 per share

(d) 25 %

Explanation:

(a) Estimated net earnings for next year.

Sales next year = $100 million

Net profit margin = 10%

Net profit margin = Net Income ÷ Sales

Net Income = 10% × $100 million

= $10 mil lion

(b) Next year's dividends per share.

Dividend payout = Dividends paid ÷ Net Income

= 50%

Dividends paid = $10 × 50%

= $5 mil lion

Per share dividend = Dividend paid ÷ Shares outstanding

= $5 million ÷ 5 million

= $1 per share

Earnings per share:

= Net income ÷ shares outstanding

= $10 million ÷ 5 million

= $2 per share

P/E Ratio = Price per share ÷ Earnings per share

Price per share = $2 × 24.5

= $49

(d) The expected holding period return (latest stock price: $40 per share).

= (Final price - Initial price + Dividend) ÷Initial Price

= ($49 - $40 + $1) ÷ $40

= 25%

8 0

3 years ago

Monica spent a lot of time preparing for her interview, but the hiring manager is not asking any of the questions she practiced.

Vinil7 [7]

A) Be flexible and adjust to different situations

This should be the answer as she needs to be flexible and adjust to different situations in situations that she does not expect. She prepared for the interview but the hiring manager is not asking any of the questions she practiced which means that she has to be more flexible and answer the rest of the questions in the interview as best as possible by adjusting to the situation.

7 0

2 years ago

Last week, the Citizens for a Greener America sent a formal letter to Tee Time Golf Resort requesting that the private club meas

Lorico [155]

Answer:

3) a watchdog group.

Explanation:

"Citizens for a Greener America" is an organization that tries to monitor the carbon footprint of other institutions and then will make the information they discover public.

"Citizens for a Greener America" acts as a watchdog group that tries to discover and make public undesirable activities carried out by government, public or private organizations.

6 0

3 years ago

Maxim Corp. has provided the following information about one of its products: Date Transaction Number of Units Cost per Unit 1/1

Setler [38]

Answer:

Cost of goods sold as per average cost method = $92,458.5

Explanation:

As for the information provided as follows:

Opening Inventory 265 units @ $153 each = $40,545

Purchase 465 units @ $173 each = $80,445

Purchase 165 units @ $213 each = $35,145

Total data 895 units = $156,135

Average cost per unit = $156,135/895 = $174.45

In average cost method simple average is performed, whereas in weighted average weights are assigned.

Sale is of 530 units

Cost of goods sold as per average cost method = $174.45 $\times$ 530 = $92,458.5

7 0

2 years ago

Firm B Firm T Shares outstanding 4,800 1,800 Price per share $ 47 $ 20 Firm B has estimated that the value of the synergistic be

zmey [24]

Answer:

A. Share Offer Is Better

B. .4569

Explanation:

A. Based on the information given the shareholders of Firm T will be better off with the STOCK OFFER because cash offer is the amount of $22 per share.

B. Calculation to determine the exchange ratio of B shares to T shares

First step is to calculate the New shares created

New shares created = 1,800(1/2)

New shares created = 900 new shares

Second step is to calculate the value of the merged firm

Value of the merged firm= 4,800($47) + 1,800($20) + $9,100

Value of the merged firm= $270,700

Third step is to calculate the price per share of the merged firm

Price= $270,700/(4,800 + 900)

Price= $270,700/5,700

Price= $47.49

Fourth step is to calculate the Equity offer value

Equity offer value = (1/2)($47.49)

Equity offer value = $23.75 per share

Fifth step is to calculate the post merger share price

Value of the merged firm= $270,700

Shares in new firm = 4,800 + 1,800x

Hence:

Post merger share price:

P= $270,700/(4,800 + 1,800x)

Sixth step

For the target firm’s shareholders to be indifferent which means they have to receive the same wealth

Hence;

1,800(x)P= 1,800($22)

Let solve this equation for P

P= $22/x

Now Let Combine the two equations

$270,700/(4,800 + 1,800x) = $22/x

x= .4569

Seventh step is to calculate the NPV

NPV = 1,800($20) + $9,100 – 1,800($22)

NPV = $5,500

Eight step is to calculate the Share price

Share price = [4,800($47) + $5,500]/4,800

Share price = $48.15

Now let calculate the Exchange ratio

Exchange ratio = $22/$48.15

Exchange ratio = .4569

Therefore the exchange ratio of B shares to T shares that the shareholders in T would be indifferent between the two offers is .4569

8 0

3 years ago