Answer:
Build more factories, Expand the size of current factories, Use cheaper materials
Explanation:
Long run is not a precise period of time thereby meaning it could span from a year to eternity, which is adequate time to plan and grow. Building more factories will increase the growth in size for the capacity for more production as well as expanding the size of the current factories. Due to the fact that there is a constraint of production capacity the company should look for alternatives in production technology in the long run so as to reduce cost of materials but with the same production quality.
Answer:
b) fall to 8 percent.
Explanation:
First, irrespective of the duration of the bond, if the price is equal to the bond's face value, it means that the coupon rate is equal to the yield to maturity (YTM).
Initial YTM = 10%
Since this is a perpetually coupon paying bond, you use PV of perpetuity to find the rate;
PV = Coupon PMT / rate
Given PV as $1,250, new annual rate would be;
1,250 = 100/rate
solve for rate by cross multiplying;
1,250rate = 100
divide both sides by 1,250
rate = 100/1,250
rate = 0.08 or 8%
Therefore, the
interest rate would fall to 8 percent.
Answer:
The lower prices create more demand for product from the nation with a reduction in the money supply, which leads to International Balance of Statement Differences
Explanation:
Gold standard is a monetary stem that links the value of paper money to gold.This system were used to balance income differences between countries. Countries with a balance of payments surplus would receive gold inflows, while countries in deficit would experience an outflow of gold
Here, Gold is the standard for International balance of payments differences.
Under the gold standard, gold flows reduce the money supply in one nation when another nation experiences a trade surplus.
The nation with a trade surplus has a swell in the money supply, which leads to price increases. At the same time, the nation with a reduction in the money supply will cause prices to fall.
The lower prices create more demand for product from the nation with a reduction in the money supply, which leads to International Balance of Statement Differences.
Answer:
A.
2015 37.7
2016 12.9
B. Yes
Explanation:
Computation of the times interest earned ratios for 2016 and 2015
First step is to find the EBIT
EBIT: 2016 $ 2015 $
Gross profit 44,500 58,400
Less Selling, General and Administrative expenses (36,900) (38,800)
EBIT 7,600 19,600
Second step is to compute the times interest earned ratios for 2016 and 2015 using this formula
Time interest earned = EBIT / Interest expense
Let plug in the formula
Time interest earned 2016 2015
EBIT $7,600 $19,600
÷Interest expense $590 $520
=Time interest earned 12.9 37.7
Therefore the Time interest earned will be :
2015 37.7
2016 12.9
2. Yes Computer Tycoon generate sufficient net income in both 2015 and 2016 before taxes and interest in order to cover the cost of debt financing.
Answer:
Therefore Expected Value of the information = $65,000+$62,000 - $10,000 = $117,000
Explanation:
If the market research survey is available for $10,000.
Using a decision tree analysis, it has been found that the expected monetary value with the survey is $65,000. The expected monetary value with no survey is $62,000.
<u>Then the expected value of the information from this sample is the expected value of each outcome and deducting the costs associated with the decision</u>
Therefore Expected Value of the information = $65,000+$62,000 - $10,000 = $117,000
