Answer:
An increase in quantity will automatically lead to a reduction in price.
An increase in price will lead to an increase in quantity supplied.
Explanation:
Option “2” and “4” are correct because the increase in quantity supplied shifts the supply curve rightwards and resulting in the price falls. While the positive relationship between price and the quantity supplied leads to an increase in supply when price increases. When price increases then the producer finds more profitable to supply more quantity. Thus, in order to curb more profit, the producer supplies more quantity when price increases.
Answer:
B.) $11.90
Explanation:
Predetermined manufacturing overhead rate are based on the estimates made by the company.
So the calculation should be:
Estimated MOH of $238,000<em> divided by</em> Estimated Machine Hours of 20,000.
Giving us the result of $11.90
(238,000 / 20,000 = 11.90)
Answer:
$0.5
Explanation:
A plant's fixed total overhead cost is $500,000 for a year
400,000 widgets are required to be produced for this period
All processes require a 40,000 machine hours and the widgets use 16,000 hours out of the total hours
The first step is to calculate the fixed overhead application rate
= $500,000/40,000
= $12.5 machine-hour
The fixed overhead that is applied to the widgets can be calculated as follows
= $12.5 × 16,000
= $200,000
Therefore, the fixed overhead that is applied to each of the widgets produced can be calculated as follows
= 200,000/400,000
= $0.5
Hence the fixed overhead that is applicable to each widgets is $0.5
Answer and Explanation:
The computation of the effect on real GDP is shown below:
change in GDP is
= Multiplier × change in investment
= 1 ÷ (1 - MPC) × change in investment
= 1 ÷ (1 - 0.65) × $150 billion
= 2 × $150 billion
= $300 billion
And, the marginal propensity to consume is
= Change in spending of consumer ÷ income change
= (2,100 - 1,200) ÷ (4,000 - 3,000)
= 900 ÷ 1,000
= 0.9
Answer:
.b. The new project should be rejected because, if it is accepted, the firm's ROE will decline from 30% because the new ROE will be a weighted average of the old 30% and the 20% returns on the new investment
Explanation:
ROE means return on equity
ROE = Net income / shareholders equity
A project should be undertaken if the ROE of the project is greater than the cost of equity
