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3 years ago

Why net profit will be higher if increases average prices to customers?

Business

1 answer:

vampirchik [111]3 years ago

6 0

Answer:

Higher prices with same sales quantity will mean greater profit.

Explanation:

Let's hold some variables constant. If a business sells books, and they take the prices up, if they sell the same quantity (at higher prices) this would increase revenues. Higher revenues, less the same cost structure (variable and fixed costs) will lead to a greater profit generation. Of course in the real world, price elasticity of demand comes in play when prices are changed. If prices go up, typically sales quantity will decrease and there may be a net effect in revenue and hence profit. In the simple case where prices go up and sales quantity is unaffected, net profit will rise.

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Menlove Corporation has provided the following cost data for last year when 100,000 units were produced and sold:

Nezavi [6.7K]

Answer:

Net operating income= $405,000

Explanation:

First, we need to calculate the unitary variable cost:

Total variable cost= 650,000 - 100,000 - 100,000= $450,000

Unitary variable cost= 450,000 / 100,000

Unitary variable cost= $4.5

Total fixed cost= 100,000 + 100,000= $200,000

Now, the net operating income for 110,000 units:

Sales= 10*110,000= 1,100,000

Total variable cost= 110,000*4.5= (495,000)

Total contribution margin= 605,000

Total fixed cost= 200,000

Net operating income= $405,000

3 0

3 years ago

FedEx Corp stock ended the previous year at $103.39 per share. It paid a $0.35 per share dividend last year. It ended last year

mr Goodwill [35]

Answer:

$730 and 3.53%

Explanation:

Given that

Initial Price = $103.39

Ending Price = $106.69

Dividend Paid = $0.35

Number of Shares owned = 200

The computation of the dollar return and the percent return is shown below:

Dollar return is

= [0.35 + ($106.69 - $103.39)] × 200

= $730

And, the percentage return is

= $730 ÷ (200 × $103.39)

= 3.53%

6 0

3 years ago

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Tatiana [17]

Answer:

3.63yrs

Explanation:

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3 years ago

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Answer:

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Explanation:

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Svetllana [295]

It can lead to burnout, low performance, stress leave,sick leave

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2 years ago

Why net profit will be higher if increases average prices to customers?​

Why net profit will be higher if increases average prices to customers?