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Answer:
b. 6 pairs of jeans per crate of olives; and
c. 4 pairs of jeans per crate of olives
Explanation:
Olives Jeans Trade off Ratio (Olives:Jeans)
Spain 1 3 1:3 or 0.33:1 (1/3 = 0.33)
Denmark 1 11 1:11 or 0.09:1 (1/11= 0.09)
Spain & Denmark have less opportunity cost & hence comparative advantage than each other, in Olive & Jeans respectively.
Spain will export Olives to Denmark (importer). Denmark will export Jeans to Spain (Importer). Trade will be gainful if they get exchange ratio better than domestic exchange ratio.
- '2 jeans pairs per olive crate' not gainful trade ratio for Spain, as it is getting more i.e 3 jeans pair per olive crate at its own domestic ratio.
- '13 jeans per olive' not gainful for Denmark, as 0.07 = (1/13) olive per jeans is worse than its own domestic ratio i.e 0.09 = (1/11) olive per jeans
'4 jeans pairs per olive crate' is gaining trade ratio for:
- Spain: As it gets 4 i.e more than 3 pairs of jeans per olive crate
- Denmark : As it gets 0.25 = (1/4) i.e more than 0.09 olive crates per pair of jeans
'6 jeans pairs per olive crate' is gaining trade ratio for:
- Spain: As it gets 6 i.e more than 3 pairs of jeans per olive crate
- Denmark : As it gets 0.16 = (1/6) i.e more than 0.09 olive crates per pair of jeans
Both of them are gainful trade ratios, but:
- 1olive:4 jeans is more gainful for Denmark, as it is gaining relatively more than domestic exchange rate (0.25 is more > 0.09 than 4 > 3).
- 1olive:6jeans is more gainful for Spain as it is gaining relatively more than domestic exchange rate (6 is more > 3 than 0.16 > 0.09)
Answer:
$778460
Explanation:
Using the highlow method, we calculate the variable cost per unit,
- VC / unit = 855460 - 651960 / 730000 - 545000 = $1.1per unit
- The total fixed cost will be = 855460 - (1.1 * 730000) = $52460
The cost estimating equation will be,
- Total cost at x number of unit = 1.1x + 52460
The cost of manufacturing supplies for the month of July will be,
- Total cost (July) = 1.1(660000) + 52460 = $778460
Answer: $22,200.72
Explanation:
Given the following :
Amount Pete Morton wants to be able to withdraw each period = $8000
Number of periods = 3
Interest rate on deposit = 4%
The amount Pete must deposit at the beginning of his study to be eligible is the product of the payment per period and the present value of annuity factor.
From the present value of annuity factor table ; the factor obtained for a 3 years period at 4 % Interest rate is 2.77509
Hence,
$8000 × 2.77509 = $22,200.72
