If Country B has an absolute advantage over Country A in producing bicycles, it must also have a comparative advantage over Country A in producing bicycles - False
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Explanation:</u></h3>
When any organisation has the ability to produce a product identical to its competitor company in such a way it utilizes only lesser amount of the given resources producing more product then it is said to have absolute advantage. Comparative advantage refers to the ability of a firm in producing a particular goods or services at a lesser marginal cost when compared with the opportunity cost.
Absolute advantages helps a firm to reduce its production cost than its competitors. Comparative advantage helps a firm in reducing the opportunity cost. It is not necessary to have a company to have both absolute and comparative advantage at the same time. It can either have absolute or comparative advantage.
Answer:
True
Explanation:
The direct cost is that cost which is directly related to the manufacturing process of the product or the production process of the product
The example of the direct cost involves direct material cost, direct labor cost, supplies cost of manufacturing, travel, subcontracts, computer time, etc
Hence, the given statement is true.
Answer:
The total cash receipt in the month of April amounts to $42,023
Explanation:
Total cash receipt in the month of April = March credit sales amount + April credit sale amount (25% is received) + April cash sales amount
= $29,400 × 67% + $32,900 × 25% + $14,100
= $19,698 + $8,225 + $14,100
= $42,023
Working Note:
March credit sales = March sales × 70%
= $42,000 × 70%
= $29,400
April Cash Sales = April Sales × 30%
= $47,000 × 30%
= $14,100
April Credit Sale = April Sales × 70%
= $47,000 × 70%
= $32,900
From the credit sale, 25% is received in the month of April
So,
= $32,900 × 25%
= $8,225
Answer:
$11880
Explanation:
Given that:
In a local Honda Dealership;
Last year, your dealership earned a record profits of $1.5 million
according to the local Chamber of Commerce, your earnings were 10 percent less than either of your competitors.
The Price Elasticity of demand E = - 4.5
Marginal cost of a midsized automobile = $11,000
Let assume that In your market, you compete against two other dealers
From The above given data , the objective is to determine the What price should you charge for a midsized automobile if you expect to maintain your record sales.
So; in order to achieve that ; we consider the scenario of an Oligopoly market by using the markup formula for homogeneous product Cournot Oligopoly which can be represented as:
P = 1.08 × 11000
P = $11880
Hence. the price you should charge for a midsized automobile if you expect to maintain your record sales is $11880
