Answer: 14.95%
Explanation:
The firm required return is;
= Risk free rate + beta * (Market return - RIsk free rate)
= 6.5% + 1.30 * ( 13% - 6.5%)
= 14.95%
<em>It is better to use the estimated future return. </em>
Holding the nonprice determinants of demand constant, a change in price would result in either a decrease in demand or an increase in demand.
An alternate in a nonprice determinant changes the relationship between rate and amount demanded, either increasing or reducing the amount demanded at every rate. on occasion referred to as non-very own-rate determinant. A boom or decrease in the amount demanded of an awesome, service, or resource at each fee.
The demand curve shifts horizontally. A surplus will arise in a market if: the quantity provided at a given rate exceeds the amount demanded at that rate.
Whilst a nonprice determinant of demand modifications calls for curve shifts, there may be a boom or lower in demand. when the rate of great adjustments, we move along the demand curve to a new factor on the curve, and there's a boom or lower in quantity demanded.
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Answer:
c. Higher-skilled workers are readily available at the higher wage.
Explanation:
the government decree would make the cost of hiring low skilled labour higher. As, a result there would be a reduction in the quantity demanded of low skilled labour.
if High skilled workers are readily available at the higher wage this would lead to a greater decrease in employment of low-skilled workers. Employers would ask themselves why pay the same high wages high skilled labour earns to low skilled labour when high skilled labour can be hired at the same price since most likely higher skilled workers would carry out the tasks better than lower skilled labour ?
To calculate:
1) Net income (loss) for 2010.
2) Operating cash flow
Solution: 1)
Sales = $850000
Less: Cost of goods sold = $610000
Gross profit = $240000
Less: Administrative and selling expenses = $110000
Earning before Interest, Tax and Depreciation = $130000
Less: Depreciation = $140000
Earning before Interest and Tax (EBIT) = ($10000)
Less: Interest expense = $85000
Earning before tax (EBT) = ($95000)
Less: Tax = $0 (as company is having negative EBT or loss hence no tax)
Net loss = $95000
2) Operating cash flow
EBIT + Depreciation - Tax
Wherein, EBIT = Earning before Interest and Tax
($10000) + 140000 - 0 = $130000
Answer:
b. direct labor and factory overhead
Explanation:
The conversion cost is that convert which is used to convert the raw material to the finished goods inventory. It is a combination of the direct labor cost and the factory overhead or manufacture overhead cost.
It can be fixed or variable marinating costs only. It does not include direct material cost
It is computed by taking a difference of production cost and raw material cost
Hence option b is correct
