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Anna007 [38]
3 years ago
9

Perez Concrete Company pours concrete slabs for single-family dwellings. Lancing Construction Company, which operates outside Pe

rez’s normal sales territory, asks Perez to pour 51 slabs for Lancing’s new development of homes. Perez has the capacity to build 460 slabs and is presently working on 160 of them. Lancing is willing to pay only $2,550 per slab. Perez estimates the cost of a typical job to include unit-level materials, $870; unit-level labor, $500; and an allocated portion of facility-level overhead, $1,250.
Calculate the contribution to profit from the special order. Should Rooney accept or reject the special order to pour 47 slabs for $2,510 each?
Business
1 answer:
cricket20 [7]3 years ago
4 0

Answer: Rooney should accept as there is a chance to make a profit of $53,580

Explanation:

Rooney has the capacity to build the additional slabs so can do so without stopping other orders.

Revenue should Rooney accept project:

= 47 * 2,510

= $117,970

Cost should Rooney accept project:

= (870 * 47) + (500 * 47)

= $64,390

Total profit:

= 117,970 - 64,390

= $53,580

<em>Rooney should accept as there is a chance to make a profit of $53,580</em>

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Suppose a factory emits pollution into the air during its production process. The demand​ (D) for its output​ (Q) is p​= 2400- Q
anastassius [24]

Answer:

240

Explanation:

The computation of the optimal fee per unit of output is as follows:

As we know that

Marginal cost = Price

MC = P

1Q = 2,400 - Q

1Q + Q = 2,400

2Q = 2,400

Q = 2,400 ÷ 2

= 1,200

MC = 0.8Q

= 0.8 (1,200)

= 960

Now the optimal fee per unit of output is

= 1,200 - 960

= 240

4 0
3 years ago
Polly sells goods to customers in exchange for a $10,000 noninterest-bearing note due in 3 years. The interest rate on this type
Irina-Kira [14]

Answer:

present value = $8396.19

Explanation:

given data

cash flow = $10,000

rate r = 6 %

time period t = 3 years

to find out

present value of the note  

 

solution

we get here present value that is expressed  as

present value =   \frac{cash\ flow}{(1+r)^t}     ....................1

put here value and we will get present value

present value = \frac{10000}{(1+0.06)^3}  

solve it we get

present value = $8396.19

7 0
3 years ago
Suppose that market demand is Q = 660 – 12P and marginal cost is MC = 5. The consumer surplus in a perfectly competitive market
Ad libitum [116K]

Answer: 15000; 3750

Explanation:

From the question,

Q = 660 – 12P

MC = 5

The consumer surplus in a perfectly competitive market will be:

P = MC

Therefore, P = 5

Q = 660 - 12P = 660 - 12(5) = 660 - 60 = 600

Consumer surplus = 1/2 × (55 - 5) (600)

= 1/2 × 50 × 600

= 15,000

For monopoly, MR = MC

Total Revenue = P × Q

Since Q= 660 - 12P

P = (660 - Q)/12

TR = P × Q

= (660 - Q)/12 × Q

= (660Q- Q²)/12 × Q

MR = (660 - 2Q)/12

MR = MC

(660 - 2Q)/12 = 5

(660 - 2Q) = 5 × 12

660 - 2Q = 60

2Q = 660 - 60

2Q = 600

Q = 600/2

Q= 300

Since P =(660 - Q)/12

= (660 - 300)/12

= 360/12

= 30

Consumer surplus = 1/2 × (55 - 30) (30)

= 1/2 × 25 × 300

= 3750

Therefore, the answer is 15000; 3750

7 0
2 years ago
Explain why, in seeking to avoid financial crisis, the government's role as regulator of the financial system does not imply it
GREYUIT [131]

Answer: Market Efficiency

Explanation:

It is important that the Government as a regulator should not get involved in acts that would protect individual institutions from failure because that would defeat the whole purpose of a competitive industry.

If a government is known to directly involve itself in the protection of institutions from failure, efficiency in institutions may become low because of the lack of fear of failure as companies believe that should they run into bad times, they will simply be bailed out by the government so there is no need for them to maintain a competitive edge.

This can lead to a situation where we have companies performing sub optimally in an economy which can only act to reduce the Economic growth of a country.

Government institutions usually have such backing and in a lot of countries are prone to failure. Look at the Bamangwato Concessions Limited (BCL) mine in Botswana for instance that kept failing and refusing to improve it's efficiency because they could always run back to the government for a bailout. Their position eventually became so untenable that bankruptcy was the only option.

3 0
3 years ago
g which is debt-free and finances only with equity from retained earnings. You were given the following information: rRF = 3.50%
Pachacha [2.7K]

Answer: 7.46%

Explanation:

The CAPITAL ASSET PRICING MODEL is a very useful tool for calculating a firm's Cost of Equity.

The Formula is,

Rc = Rrf + b(Rpm)

Where,

Rc is the Cost of Equity

Rpf is the Risk risk free rate

b is beta

Rpm is the risk premium

Plugging in the digits we have,

Rc = 0.0350 + 0.88(0.045)

= 0.0746

The firm's cost of equity from retained earnings based on the CAPM is therefore 7.46%

3 0
3 years ago
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