Answer: 16.9697%
Explanation:
Sales = $165 million
Assets in beginning of year = $280 million
Assets return on start of the year = 10%
Operating Profit = 28
= 16.9697%
Find the following values using the equations and then a financial calculator. Compounding/discounting occurs annually. Do not r
1 answer:
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Answer:
the question is incomplete:
It happens that the set of consumption bundles (xA,xB) such that Charlie is indifferent between (xA,xB) and (20,5) is the set of all bundles such that xB = 100/xA. The set of bundles (xA,xB) such that Charlie is just indifferent between (xA,xB) and the bundle (10,15) is the set of bundles such that xB = 150/xA.
I also found the attached graph.
The requirements are:
- Is (30,5) ≈ (10,15) true or false?
- Is (10,15) > (20,5) true or false?
- Is (20,5) ≥ (10,10) true or false?
- Is (24,4) ≥ (11,9.1) true or false?
- Is (11,14) > (2,49) true or false?
- A set is convex if for any two points in the set, the line segment between them is also in the set. Is the set of bundles that Charlie weakly prefers to (20,5) a convex set?
- Is the set of bundles that Charlie considers inferior to (20,5) a convex set?
- The slope of Charlie’s indifference curve through a point, (xA,xB), is known as his ______________ ___ of ___________ at that point.
- Find Charlie’s marginal rate of substitution at the point (10,10).
- Find Charlie’s marginal rate of substitution at the point (5,20).
- Find Charlie’s marginal rate of substitution at the point (20,5).
- Do the indifference curves you have drawn for Charlie exhibit diminishing marginal rates of substitution?
Answers:
- true, they are on the same red line
- true, (10,15) is on the red line while (20,5) is on the blue line
- true, they are equivalent since both are on the blue line
- false, (11,9.1) is on the blue line and (24,4) is on the red line
- true, (11,14) is on the red line while (2,29) is on the blue portion
- yes, it is a convex set
- no, they are not a convex set
- The slope of Charlie’s indifference curve through a point, (xA,xB), is known as his <u>RATE</u> of <u>SUBSTITUTIO</u>N at that point.
- marginal rate of substitution at (10,10) = -10/10 = -1
- marginal rate of substitution at (5,20) = -20/5 = -4
- marginal rate of substitution at (20,5) = -5/20 = -1/4 = -0.25
- yes, this curves shows diminishing marginal rates of substitutions, e.g. goes from -4 to -1 to -0.25
