Answer: Option D
Explanation: In simple words, gross profit refers to the amount of revenue that the company is left with after deduction for the expenses that are incurred to make and sell that specific product.
The low pay to supplier means that the company will have a low cost to produce the product which will result in increase in gross profit.
Hence the correct option is D.
Answer:
The black death epidemic resulted to death about 34 million European, left more job vacant. This was becuase many workers died while the jobs the were working on as at that time remained almost unchanged. The remained workers after the black death demanded for rise in wages, although the lords stood against the demand.
Explanation:
Although worker population decreased because of the plague, the amount of land and the tools did not change much. Some farm animals died when the people who took care of them died. Because the remaining workers had more tools and land to work, they became more productive, producing more goods and services. When workers are more productive, employers are willing to pay higher wages. The Statute of Laborers and similar laws in other countries were not very effective. Some lords avoided violating the statute by making “in kind” pay-ments—paying workers with food or other goods rather than wages—or providing other “fringe benefi ts.” Some lords began to pay illegally high wages. Wages increased because there were fewer workers—labor had become more scarce
Answer:
Price discrimination is when a producer charges different prices, to different consumers for the same good or service. Therefore, an airline that charges different prices to different passengers for the same flight is practicing a third degree price discrimination because consumers are charged different prices based on their different demand elasticities.
Economic efficiency is when scarce resources are used in the most efficient way to produce maximum output; it consists of productive efficiency and allocative efficiency. For price discrimination to be possible, the firm must have a certain degree of monopoly power; that is, the firm must be a price maker. Monopolies typically fit into this description as they discriminate by charging consumers with an inelastic demand higher prices; this reults in allocative ineffciency because price is greater than the Marginal Cost (P>MC).
On the other hand price discrimination could increase efficiency; price discrimination aims to convert consumer surplus to producer surplus, thereby increasing the profit of the firm. An increase in profits could be dedicated to investement in research and development; this could see such a firm achieve dynamic efficiency (long-run productive efficiency). Secondly, due to the increased profits and the potential for more profits, output is increased and price moves closer to the MC (Closer to allocative efficiency). In addition, an increase output would mean that the firm is making use of its spare/idle capacity in production, moving output towards optimum. From another perspective, a firm can reap economies of scale through price discrimination; this is because price discrimination leads to an increase in output and a reduction in average cost.
Explanation:
Answer:
Current liability for 3 months will be $4500
Explanation:
We have given that
Sensible insurance company has collected a premium of $18000
We have given time = 1 year = 12 months
So the premium collected per month [tex]=\frac{$1800}{12}=$1500[/tex
Now, the company has collected the revenue on April 1 and now it is December 31
So number of months from April to December = 9
So total premium earned in 9 months = 9× $1500 = $13500
So current liability for 3 months will be = 3×$1500 = $4500
Answer:
1. $240
2. 12.5%
3. $168.75
Explanation:
1. Total cost per unit = Variable cost per unit + Fixed cost Per unit
= $150 + $90
= $240
Where ;
Variable costs per unit = Direct material +Direct labor + Overhead + Selling
= $100 + $25 + $20 + $5
= $150 per unit
Fixed costs per unit = Total fixed cost / Number of units produced
= ($470,000 + $105,000 + $325,000) / 10,000 units
= $900,000 / 10,000
= $90 per unit
2. Mark up percentage on Total cost = Mark-up / Total cost *100
= $300,000 / $2,400,000 * 100
= 12.5%
Where;
Total cost = Total cost per unit * Number of units produced
= $240 * 10,000 units
= $2,400,000
3. Selling price = Total cost per unit + Mark up
= $150 + ($150 * 12.5%)
= $150 + $18.75
= $168.75
