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3 years ago

11

Which of the following choices is a movement along the demand curve showing that a different quantity is purchased in response t

o a change in price?
a. income effect
b. change in quantity demanded
c. substitution effect
d. an increase in the price of a complement

1 answer:

SVEN [57.7K]3 years ago

5 0

It'd be B...

...........

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A $2.00 increase in a product's variable expense per unit accompanied by a $2.00 increase in its selling price per unit will: A)

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Answer:

A) decrease the degree of operating leverage

Explanation:

The contribution margin is

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(sales + 2) - (variable + 2) = sales - variable

no change

so B is FALSE

as the contribution margin ratio is:

(sales - variable ) / sales

this increase will impact the contribution margin ratio.

(sales + 2 - (variable +2))/ (sales + 2)

(sales - variable) / (sales + 2)

the CMR will decrease.

so D is FALSE

the break-even on sales will increase as the CMR decreases

more units are needed to fullfil the fixed cost

so C is FALSE

A) decrease the degree of operating leverage

ΔEBIT / Δrevenue

sales increase and the variable cost increases

a change in the sales revenue will not be as efficient as it was before the degree of leverage will decrease.

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4 years ago

A client is trying to decide between a par value corporate bond carrying a coupon rate of 6.25% per year and a par value municip

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Answer:

Municipal bond

Explanation:

We can clearly find out which bond to select by finding their equivalent taxable yield.

DATA

Coupon rate (corporate bond) = 6.25%

Coupon rate (municipal bond) = 4.75%

Marginal income tax = 28%

Equivalent taxable yield of municipal bond = coupon / (1-tax rate)

Equivalent taxable yield of municipal bond = 4.75% / (1-0.28)

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Hence municipal bond must be selected having a higher equivalent taxable yield as compared to corporate bond.

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Answer:

Answers are 1, 4, 5, 6

Explanation:

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3 years ago

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Answer:

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Explanation:

Differential pricing , also known as discriminatory pricing is a pricing strategy in which the same product are sold to different customers at different prices.It enables companies to take advantage of unique customers valuation.

Even though is mostly seen as a legal way of pricing just like the other pricing methods , but in a situation where it is biased towards a category of people because of their tribes , gender religion other discriminatory factors , it becomes an illegal act.

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Fuzzy Monkey Technologies, Inc., purchased as a long-term investment $220 million of 8% bonds, dated January 1, on January 1, 20

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Answer and Explanation:

1 to 3.

Journal Entries - Fuzzy Monkey Technologies Inc.

Debit (In Million) Credit (In Million)

1. 1-Jan-21

Dr Investment in Bond Dr $220.00

Cr To Cash $201.00

CrTo Discount on bond investment $19.00

2.

30-Jun-21

Dr Cash ($220 *8% * 6/12) $8.80

Dr Discount on bond investment Dr $1.25

Cr To Interest revenue ($201*10%*6/12) $10.05

3.

31-Dec-21

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Dr Discount on bond investment Dr $1.31

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4a.

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4b.

Journal Entries - Fuzzy Monkey Technologies Inc.

Debit (In Million) Credit (In Million)

1. 31-Dec-21

Dr Fair value adjustment ($210 - $201 - $1.25 - $1.31) $6.44

Cr To Unrealized holding gain or loss - OCI $6.44

5.

Statement of cash flows (Partial)

For 2021

Particulars Amount (In million)

Cash flow from operating activities:

Interest received $17.60 Inflow

Cash flow from investing activities:

Cash paid for purchase of investment $201.00

Outflow

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3 years ago