Answer: arithmetic Average Return =11.33%
Geometric Average Return=10.33%
Explanation:
Returns per year
Year 1 16%
year 2 23%
year 3 15
year 4 -11%
year 5 30 %
year 6 -5%
Total = 68%
Arithmetic Average = Total returns 0f ( year 1 -6) / number of years
= 68%/6 =11.33%
Geometric Average Return is given as
= ((1 + R1) × (1 + R2) × ... × (1 +Rn))(1/n) - 1
((1 + 16%) × (1 + (23%)) × (1 + 15%) x (1+ -11%) x (1+30%) x (1+ -5%))^1/6 - 1
((1.16 x 1.23 x 1.15 x 0.89 x 1.30 x (0.95)) ^1/6
((1.16 x 1.23 x 1.15 x 0.89 x 1.30 x 0.95)) ^1/6 -1
(1.8035073 )^1/6 - 1
= 1.10328 -1 = 0.10328 x 100 = 10.328% =10.33%
Answer:
Option (B) is correct.
Explanation:
If there is an increase in the income of the consumer then as a result there is a parallel shift in the budget line. This increase in income will increase the real purchasing power of the consumers and hence, this would increase the quantity of two goods consumed in an equal proportion.
Other factors remains the same, an increase in the income level of the consumer will increase the consumption of both the goods because the prices of both the goods are constant.
The correct answer is: "I would recommend her not to increase the price, because with an elastic demand function this will cause a great decrease in the quantity demanded by consumers".
The demand function represents the quantity of a certain good or service that consumers are willing to purchase in the market at different price levels. The law of demand states that there is an inverse relationship between price and quantity demanded (ceteris paribus, hence, given that the rest remains equal). <u>Therefore, when the price charged decreases, the amount that consumers are willing to purchase increases. </u>
In turn, the elasticity of the demand function measures the sensitiveness of the quantity demanded by consumers when there is a certain price change. If the demand function is elastic it means that a price variation would generate an even larger variation (in the inverse direction of course!) in the quantity demanded. <u>This is the case of the lemonade stand therefore the girl should not increase prices because this will not help her to reach her objective quicke</u>r, as she would loss a greater proportion of units sold than the size of the price increase that would have allowed her to earn more per unit.
Answer: $1,110 .
Explanation:
Given : Amount received by concession stand in gameday sales = $5,550
i.e. Gross income = $5,550
Profit for the event = $3,330
i.e. Net income =$3,330
According to the Net income formula ,
Gross income - expenses = Net income
⇒ Expenses = Gross income - Net income
⇒ Expenses = $5,550- $3,330
⇒ Expenses = $1,110
Thus , the expenses were $1,110 .
Answer:
$8,770.00
Explanation:
In this question we use the present value formula i.e shown in the attachment below:
Data provided in the question
Future value = $0
Rate of interest = 0.48%
NPER = 4 years × 12 months = 48 months
PMT = $205
The formula is shown below:
= -PV(Rate;NPER;PMT;FV;type)
So, after solving this, the answer would be $8,770.00
