Answer:
Result : Incremental profit of $2,280
Explanation:
Consider the incremental costs and revenues resulting from the $5,000 increase in the monthly advertising budget.
<u>Analysis of incremental costs and revenue</u>
Sales (140×$ 130) 18,200
Less Variable expenses (140×$ 78) (10,920)
Contribution 7,280
Less Fixed Costs
Advertising (5,000)
Net Operating Income / (Loss) 2,280
Result : Incremental profit of $2,280
Calculate the value of
the stock:
<span>The dividend on
preferred stock is received constantly for perpetuity. So, the value of
preferred stock can be calculated by dividing the dividend with the required
rate of return. If the dividend rate is 8% on par value of $ 100 and required
rate is 6% the value of preferred stock will be P = (100x0.08)/0.06 = 8/0/06 =
133.3333333</span>
To put it simply, they have to develop a product that make people want to pay to acquire it.
Sellable product usually either :
- able to make people happy ( such as movies, music, Delicious food, etc) or
- Able to make people's life become easier ( such as Gadgets, consultation service, etc)
