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Alex Ar [27]
3 years ago
12

Certain economic principles are of considerable importance in the valuation of real estate. The principle that "no buyer will pa

y more for a product than the price he can pay for a reasonable duplicate" is known as the principle of:
Business
1 answer:
Svet_ta [14]3 years ago
5 0

Answer:

Substitution

Explanation:

Principle of subsitution states that no consumer should buy a product for a high price of he can get an alternative (duplicate) that is of a cheaper price.

Substitutes are alternatives that provide similar satisfaction to the customer.

When the price of one product goes up the customer has a choice of going for an alternative.

For example honey and sugar are substitutes. When the price of one goes down people will go for the cheaper alternative. This acts as a price control mechanism.

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Last quarter, RP Enterprises earned $220,000 in sales revenue and had $90,000 cost of goods sold (at standard). RP also experien
Rudik [331]

Answer:

Gross profit= 131,500

Explanation:

Giving the following information:

Last quarter, RP Enterprises earned $220,000 in sales revenue and had $90,000 cost of goods sold (at standard). RP also experienced these variances: Materials price: $2,400 F Materials quantity: $1,400 U Labor price: $2,000 U Labor quantity: $1,000 F Overhead: $1,500 F

To calculate the cost of goods sold, we use actaul costs and quantity of direct labor and direct materials. Therefore, the only estimated cost is overhead.

Gross profit= 220,000 - 90,000 + 1,500= 131,500

4 0
3 years ago
Van, a friend of yours from high school, recently called. He asked if you could explain to him how the value of his portfolio wo
12345 [234]

Answer:

Van is asking about Investment area of finance.

Explanation:

  • The developments reported can affect the market sentiments generally.
  • The service provided by the Finance professional to his investor friend in the given context is advice regarding Investments.
  • A investment is a resource or thing gathered fully intent on creating pay or acknowledgment.
  • In a monetary viewpoint, a venture is the acquisition of merchandise that are not devoured today however are utilized in the future to produce abundance

Learn more about investment, refer :

brainly.com/question/14847954

6 0
3 years ago
You are a newspaper publisher. You are in the middle of a one-year rental contract for your factory that requires you to pay $50
Anettt [7]

Answer and Explanation:

The computation is shown below:

Fixed cost is

= $500,000 + $1,000,000

= $1,500,000

And, the marginal cost is

= $0.25 + $0.10

= $0.35 per paer

Now

as we know that

AFC = FC ÷ Q

Now for At 1,000,000 papers,

AFC is

= 1,500,000 ÷ 1,000,000

= $1.50/mo

At 800,000 , it would be

AFC = 1,500,000 ÷ 800,000

= $1.875/mo

MC = $0.35 per paper  and the same is not changed

Now for break even, the average total cost is

ATC = AFC + AVC

ATC = FC ÷ Q + VC ÷ Q

VC = MC × Q

ATC = FC ÷ Q + MC

ATC = FC ÷ Q + 0.35

At Q = 1,000,000,

ATC = 1.50 + 0.35

ATC = $1.85

At Q = 800,000 , it would be

ATC = 1.875 + 0.35

=  $2.225

As it can be seen that

The AFC changes from 1.50 to 1.875 which shows an increment of 0.375.

The MC remains constant or same  at 0.35 as the printing and delivery costs per paper are remain same

And, The minimum amount that we must charge to break even rises i.e. from 1.85 to 2.225. That is a rise of 0.375

6 0
3 years ago
You were asked to estimate the cost of capital for XYZ Inc. The firm is expected to have a target capital structure of 30% debt,
kap26 [50]

Answer:

8.30%

Explanation:

The weighted average cost of capital of the company is  computed using the WACC formula below:

WACC=(We*Ke)+(Wp*Kp)+(Wd*kd)

We=weight of common equity=50%

Ke=cost of retained earnings which is a proxy for the cost of equity=11.50%

Wp=weight of preferred stock=20%

Kp=cost of preferred stock=6.00%

Wd=weight of debt=30%

Kd=after-tax cost of debt=4.50%

WACC=(50%*11.50%)+(20%*6.00%)+(30%*4.50%)

WACC=8.30%

3 0
3 years ago
Rio Coffee Shoppe sells two coffee drinks, a regular coffee and a latte. The two drinks have the following prices and cost chara
stepan [7]

Answer:

a) Regular coffee cups required to be sold = 4,690

b) Latte cups required to be sold = 2,010

Explanation:

As per the data given in the question,

For computing Contribution per mix :

Particulars              Regular             Coffee Latte

Sales price              $1.60                 $2.80

Less: variable cost $0.90                $1.70

Contribution           $0.70                 $1.10

Contribution per mix = ($0.70 × 70%) + ($1.10 × 30%)

= $0.82

Breakeven point at sales mix = Fixed cost ÷ Contribution per mix

=$5,494 ÷ $0.82

= 6,700 mixes

Requirement:

Cups of regular coffee for breakeven = Breakeven at sales mix × %of regular coffee sales

=6,700 × 70%

= 4,690 Cups

Cups of latte for breakeven = Breakeven at sales mix × %of latte sales

=6,700 × 30%

=2,010 Cups

3 0
3 years ago
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