Increase, assuming packaged coffee=coffee, people will demand more coffee being aware that its price will be increased, thus they will try to consume its benefits before its price goes up.
Answer:
The manger did not make a mistake
To determine the effect that an increase in price would have on revenue, we have to determine the price elasticity of demand.
Price elasticity of demand measures the responsiveness of quantity demanded to changes in price
Price elasticity of demand = percentage in quantity demanded / percentage change in price
4% / 5% = 0.8
The elasticity of demand is less than 1, this means that demand is inelastic
When demand is inelastic, if price is increased, the fall in quantity demanded would be less than the increase in price. As a result, if price is increased total revenue would fall.
Based on the manger's calculation, demand is inelastic, so she was not wrong in increasing price.
Explanation:
Answer: c. taxes on capital gains can be timed
Explanation:
Capital gains represent an appreciation in the value of a security therefore they bring in profit to the owners of that security. Capital gains are not taxed until the owner sells the security which means that these taxes can be timed by the owner who can decide to sell at specific times to reduce their tax bill.
This is different from dividends that are taxed as soon as the company declares them. The investors have no say as to the tax timing so they will prefer capital gains where they have some form of control.
Explanation:
Occupancy rate is the ratio of rented or used space to the total amount of available space.
The potential gross rate is the total rental income a property can produce if all units were fully leased and rented at market rents with a zero vacancy rate.
They relate through that they both allow for renting?
Answer:
Option (b) is correct.
Explanation:
Sale of share = NQOs received × No. of shares × Selling price per share
= 10 × 8 × $22
= $1,760
Gain realised:
= Sale of share - Basis
= $1,760 - [NQOs received × No. of shares × Selling price per share at $15]
= $1,760 - [10 × 8 × $15]
= $1,760 - $1,200
= $560
Tax paid = Gain realised × preferential rate
= $560 × 15%
= $84
