Answer:
The correct answer is A.
Explanation:
Giving the following information:
Mcmurtry Corporation sells a product for $110 per unit. The product's current sales are 12,200 units and its break-even sales are 10,614 units.
<u>The margin of safety is the number of units or amount of dollars that provide genuine profit to the company. It is the "margin" that gives room to try new strategies</u>.
It is calculated using the following formula:
Margin of safety ratio= (current sales level - break-even point)/current sales level
Margin of safety ratio= (12,200 - 10,614) / 12,200
Margin of safety ratio= 0.13=13%
Answer:
$10,000
Explanation:
Given that
Total revenue is $70,000
Total fixed cost is $40,000
And, the total variable cost is $10,000
According to the given situation, the computation of profit is shown below:-
Profit = Total Revenue - Total Fixed cost - Total variable cost
= $70,000 - (10,000 × $4) - 10,000
= $70,000 - 40,000 - 10,000
= $10,000
Therefore for computing the profit we simply applied the above formula.
Answer:
a. Increase in Net Exports, Increase in AD, real GDP will stay same
b. Excess Demand
c. Appropriate Contractionary Fiscal Policy : decrease tax & or increase government expenditure
d. Actions smooth business cycle by brining actual real GDP towards full employment
Explanation:
Aggregate Demand is the total value of goods & services all the sectors of an economy are planning to buy during a given period of time
Aggregate Demand [AD] = Consumption [C] + Investment [I] + Government Expenditure [G] + Net Exports [NX = Exports (X) - Imports (M)]
Aggregate Demand > Aggregate Supply at full employment level is Excess Demand. Aggregate Demand < Aggregate Supply at full employment level is Deficit Demand
Decrease in Investment leads to fall in Aggregate Demand. It creates Deficit Demand & decreases real GDP. It can be corrected through demand expansionary fiscal policy of decreasing taxes & increasing govt. expenditure.
Increase in exports leads to increase in net exports & in turn increase in aggregate demand. This causes Excess demand problem & real GDP will remain same (economy already at full equilibrium, GDP cant be increased more). Appropriate Fiscal Policy [Contractionary Fiscal Policy] includes decreasing taxes & or increasing govt. purchase.
These actions will smooth out business cycle by bringing actual real GDP back to full employment level.
Answer:
Future Value will increase
Explanation:
Future Value = Present Value (PV)*(1 + i)^n
<em>Let Amount be $10,000</em>
<em>Interest = 12% compounded annually</em>
<em>Period = 4</em>
Future Value = $10,000 * (1 + 12%)^4
Future Value = $15,735.19
<em>Let Amount be $10,000</em>
<em>Interest = 12% compounded quarterly</em>
<em>Period = 4 (4*4)</em>
Future Value = $10,000*(1 + 3%)^16
Future Value = $16,047.06
Conclusion: The future value will increase.
The term for goods that your business ships to another country is known as <u>Exports</u>.
Export/ Exporting:
- The process by which companies from one country sell their goods and services to companies or consumers in a different country is known as Exporting.
- The exports, along with imports, make up international trade.
- They are incredibly important to modern economies as they offer people and firms many more markets for their goods.
- Exporting into foreign markets can reduce per-unit costs by expanding operations to meet increased demand.
- Also, the companies that export into foreign markets gain new knowledge and experience that may allow the discovery of new technologies, marketing practices, and insights into foreign competitors.
