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Lemur [1.5K]
3 years ago
12

Firms A and B plan to collude in an economy for their similar​ products, which includes the grim strategy for punishment. They p

lan to set the price of their product at​ $8. The marginal cost of Firm A is​ $5 and Firm B is​ $4.50. If firm A is impatient to earn more profits and Firm B wishes to last in the business for the​ long-run, which of the following situations would likely​ occur? A. Firm B reduces the price to​ $7 causing Firm A to exit the market. B. Firm B reduces the price to​ $7 causing Firm A to reduce its price to​ $7. C. Firm A reduces the price to​ $7 causing Firm B to reduce its price to​ $4.50. D. Firm A reduces the price to​ $7 causing Firm B to exit the market.
Business
1 answer:
denis-greek [22]3 years ago
3 0

Answer: C. Firm A reduces the price to​ $7 causing Firm B to reduce its price to​ $4.50.

Explanation:

Since firm A is impatient to earn more profits and Firm B wishes to last in the business for the​ long-run, then Firm A will reduce the price to​ $7 causing Firm B to reduce its price to​ $4.50.

Since Firm A reduces the price to​ $7, this will lead to an increase in the quantity demanded of the product and therefore the firm can earn more profit. On the other hand, firm B will reduce its price to a point where the price meets the marginal cost which is $4.50.

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Nadusha1986 [10]

Answer:

18.24

Explanation:

Sustainable growth rate is the rate of growth a company can afford in the long term

sustainable growth rate = retention rate x ROE  

b = retention rate. It is the portion of earnings that is not paid out as dividends

Retention rate = 1 - payout ratio =

payout ratio = dividend / net income

retention rate = 1 - $44,640 / 72,000 = 0.38

Return on equity = net income / average total equity

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g = 0.48 x 0.38 = 18.24%

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3 years ago
What is VAT number?why we need this?
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Answer:

what is a vat

Explanation:

7 0
2 years ago
Read 2 more answers
The field of operations management is shaped by advances in which of the following fields?
natulia [17]

Answer:

E) all of the above

Explanation:

THIS ARE THE OPTIONS FOR THE QUESTION BELOW

A) chemistry and physics

B) industrial engineering and management science

C) biology and anatomy

D) information technology

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7 0
3 years ago
Hayduke Corporation reported the following results from the sale of 5,000 units in May: sales $300,000, variable costs $180,000,
bazaltina [42]

Answer:

4,444.44 units

Explanation:

For the computation of Number of units to be sold to earn target profit first we need to follow some steps which are shown below:-

Selling price per unit = Sales ÷ Number of units sold

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Increase in selling price = $60 × 5%

= $3

New selling price per unit = $60 + $3

= $63

New contribution margin per unit = New selling price per unit - Variable cost per unit

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= ($90,000 + $30,000) ÷ $27

= $120,000 ÷ $27

= 4,444.44 units

7 0
3 years ago
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Aleonysh [2.5K]

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c) A heuristic

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3 years ago
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