Answer:
d.the company is precisely breaking even.
Explanation:
Margin of safety is referred to current sales - Break even sales ratio to current sales as a percentage.
Basically it is quoted as follows:
Therefore, when the current sales = Break even sales then only the company will have margin of safety = 0
Thus, at 0 margin of safety the company basically is at no profit no loss situation, that is break even.
Answer:
E. Fixed Costs
Explanation:
Here are the options to this question :
A. Variable Costs
B. Labor Costs
C. Total Costs
D. Raw material Costs
E. Fixed Costs
Sunk costs are costs that have already been incurred and cannot be recovered. They should not be considered when making future economic decisions.
Fixed cost is cost that do not vary with production. e.g. rent
Most companies pay rent per year. if due to unforeseen contingencies, sales and profit of the company declines and the company decides to shut down production, the company has already paid for rent, this amount cannot be recovered even though the company would not be using the space for sometime. So, rent is an example of sunk cost
Answer:
Explanation:
a ) We shall calculate the NPV of the project . If it is positive , then money can be invested
Cash outflow in the beginning =1000
Present value of perpetual annuity of 100 at 9.5 %
100 / .095
= 1052.63
which is more than initial cash outflow
So NPV is positive
Hence money can be invested.
b )
If machine takes one year to build , first year cash outflow of 100 will be absent
Present value of 100 after 1 year
= 100 / 1.095
= 91.32
So present value of annuity
= 1052.63 - 91.32
= 961.31
This is less than 1000 so
NPV is negative.
Hence money can not be invested.
Samsung, for having lithium ion batteries in their new phones the samsung galaxy 7, negative because they were burning up and hurting people.
Answer:
Monopoly
Oligopoly
monopolistic competition
Perfect competition
Explanation:
A perfect competition is characterized by many buyers and sellers of homogenous goods and services. Market prices are set by the forces of demand and supply. There are no barriers to entry or exit of firms into the industry.
A monopolistic competition is when there are many firms selling differentiated products in an industry. A monopolistic competition has characteristics of both a monopoly and a perfect competition. the demand curve is downward sloping. it sets the price for its goods and services.
examples of monopolistic competition are restaurants
A monopoly is when there is only one firm operating in an industry. there is usually high barriers to entry of firms. the demand curve is downward sloping. it sets the price for its goods and services.
An example of a monopoly is an utility company
An oligopoly is when there are few large firms operating in an industry. there is high barriers to entry and exit of firms
