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Bas_tet [7]
3 years ago
6

Bellsouth Mobility (BM) ran a pricing trial in order to estimate the elasticity of demand for its services. The manager selected

4 states that were representative of its entire service area and increased prices by 5% to subscribers in those areas. One month later, the number of its customers enrolled in BM's plans declined 4% in those states, while enrollments in states where prices were not increased remained flat. Based on this information, the manager estimated the own price elasticity of demand and based on her findings immediately increased prices in all markets by 5% in an attempt to boost the company's revenues. One year later, the manager was confused because BM's revenues were down 10%. Apparently, the price increase led to a reduction in the company's revenues. Did the manager make a mistake? Explain.
Business
1 answer:
hichkok12 [17]3 years ago
6 0

Answer:

The manger did not make a mistake

To determine the effect that an increase in price would have on revenue, we have to determine the price elasticity of demand.

Price elasticity of demand measures the responsiveness of quantity demanded to changes in price

Price elasticity of demand = percentage in quantity demanded / percentage change in price

4% / 5% = 0.8

The elasticity of demand is less than 1, this means that demand is inelastic

When demand is inelastic, if price is increased, the fall in quantity demanded would be less than the increase in price. As a result, if price is increased total revenue would fall.

Based on the manger's calculation, demand is inelastic, so she was not wrong in increasing price.

Explanation:

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Answer:

C

Explanation:

Reduction of cost basis per share.

When you take a look at some of the rules that IRS has, you see that stock dividends do not get taxsd at the time of receipt. They don't get taxed because, the shareholder does not receive anything from the company, only but a hope on any increased future share price increment or appreciation.

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3 years ago
A deficit on the current account Multiple Choice means that a nation is making international transfers. has no relationship to t
Sliva [168]

Answer:

The correct option is C

Explanation:

The deficit or shortage on the current account of the country, is defined as the measurement or determination of the trade of the company where the goods and the service value, it imports exceeds or increase the value of the products it exports.

The current account of the country states the foreign transactions of the country within the time period.

So, when there is deficit or shortage on the current account, it means that usually, it will cause deficit in the finance as well as the capital account of the country.

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For most companies, the web ______ the threat that new competitors will enter the market by ______ traditional barriers to entry
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Answer: b. Increases, decreasing

Explanation: For most companies, the web increases the threat that new competitors will enter the market by decreasing traditional barriers to entry. Traditional barriers to entry include

a. Economies of scale

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c. Capital requirements

d. Switching costs

e. Access to distribution channels

f. Cost disadvantages

g. Government policy

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Firms will typically maintain a list of research and development projects ranked by expected rate of return. Expected rate of re
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Expected rate of return is defined as the amount of money an individual gets on investment.

<h3>What is expected return?</h3>

The expected return is the amount of profit or addition on money invested that an individual who is an investor is expected to get after a periods of time on the investment.

Therefore, expected rate of return is defined as the amount of money an individual gets on investment.

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The 3 activities which are part of the function of accounting includes:

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Accounting (<em>including bookkeeping</em>) refers to the process of recording, preparing, analyzing and interpreting financial information or statements for future purpose.

As regards the options, 3 activities which are part of the function of accounting includes:

  • Classifying financial transactions
  • interpreting financial transactions
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In conclusion, the process of accounting helps to identifies, records, classifies and communicate the company's economic events to interested users.

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