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nadya68 [22]
2 years ago
12

A pharmaceutical company announces that it has received Food & Drug Administration (FDA) approval for a new allergy drug tha

t completely prevents hay fever. The consensus analyst forecast for the company’s earnings per share (EPS) is $5.00, and insiders agree with analyst expectations. They too expect that, with this new drug, earnings will drive the EPS to $5.00. If the markets are assumed to exhibit strong form efficiency, what will happen when the company releases its next earnings report?
a. There will be some volatility in the stock price when the earnings report is released; it is difficult to determine the impact on the stock price.
b. The stock price will not change, because the market had already incorporated the information about the FDA approval announcement in the stock price.
c. The stock price will increase and settle at a new equilibrium level.
Business
1 answer:
Natali [406]2 years ago
3 0

Answer:

b. The stock price will not change, because the market had already incorporated the information about the FDA approval announcement in the stock price.

Explanation:

If the markets are strong form efficient, it means the consensus of the market related to future impact of FDA approval on earnings would be correct, the stock price of today correctly estimates the future earnings, and therefore the stock price would not change when the earnings are released.

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A. Suppose the wages of computer-factory workers rises. This will cause (the supply / the demand) of tablet computers to (shift
Mars2501 [29]

Answer:

Supply, shift in , rise fall

the demand, shift in, fall ,fall

supply , shift out fall, rise

the demand , shift out rise rise

the demand shift in fall fall

Explanation:

If the wages of factory worker increases, it becomes more expensive to hire workers, the cost of production increases and the demand for labour would fall. as a result, production would fall and the supply of tablets would fall. a decrease in supply leads to an inward shift of the supply curve. as a result of the fall in supply, quantity would fall and there would be a rise in price.

Substitute goods are goods that can be used in place of another good. If the price of notebooks falls, it becomes cheaper to purchase notebooks, so the quantity demanded of notebooks would rise and the demand for tablets would fall since it is cheaper to buy a tablet. the demand curve for tablets would shift in as a result of the fall in demand. As a result, price and quantity of tablets would fall.

Increase in the number of manufactures would lead to an increase in supply. this would cause a rise in the supply of tablets. when there is a rise in supply, the supply curve shifts out, prices fall and quantity increases.

the new game would increase demand for tablets because people would be interested in playing the game. as a result of the rise in demand, the demand curve would shift out, the quantity would rise and prices would rise

A complement is a good that is consumed together with another good. if the price of apps rise, it would become more expensive to buy apps as result the demand for tablets would fall. the demand curve would shift in and price and quantity would fall

6 0
3 years ago
On April 30, 2017, Cupidity Corp. purchased for cash all 200 shares of the outstanding common stock of Venality Corp. for $40 pe
just olya [345]

Answer:

$1,350

Explanation:

Goodwill is the Excess of Cash Consideration over the Net Assets taken over. Net Assets taken over are measured at their Fair Market Value instead of Book Values at the Acquisition date.

Where,

Cash Consideration = $8,000

Fair Value of Net Assets Acquired ($6,000 + ) = $6,650

Therefore,

Goodwill = $8,000 - $6,650

               = $1,350

8 0
2 years ago
Bandar Industries Berhad of Malaysia manufactures sporting equipment. One of the companyâs products, a football helmet for the N
elena-14-01-66 [18.8K]

Answer:

Instructions are below.

Explanation:

Giving the following information:

According to the standard cost card, each helmet should require 0.55 kilograms of plastic, for $7.00 per kilogram.

First, we need to calculate the standard quantity of plastic to make 3,600 units.

Standard quantity= standard direct material required per unit* numbers of units

Standard quantity= 0.55*3,600= 1,980 kg

Now, we can determine the standard cost:

Standard cost= 1,980kg* $7= $13,860

7 0
2 years ago
Great Western Southern purchased $525,000 of equipment four years ago. The equipment is seven-year MACRS property. The firm is s
tester [92]

Answer: $153,782.70

Explanation:

The MACRS allowance percentages are as follows, commencing with Year 1: 14.29, 24.49, 17.49, 12.49, 8.93, 8.92, 8.93, and 4.46 percent.

In 4 years, the depreciation would be:

= Cost price * (4 year deprecation)

= 525,000 * (14.29% + 24.49% + 17.49% + 12.49%)

= $360,990

Book value :

= 525,000 - 360,990

= $164,010

Gain (loss) = Sale price - Book value

= 150,000 - 164,010

= ($14,010)

Tax payable = (14,010) * 27%

= ($3,782.70)

After-tax cash flow:

= Selling price - Taxes

= 150,000 - (-3,782.70)

= $153,782.70

<em>Note: If there are options, beware of rounding errors and pick nearest option. </em>

6 0
3 years ago
Why are marketers sometimes "forced” to reposition their products or services? Il
Sergio039 [100]

<h3>Explaination</h3>

Marketers sometimes forced to reposition their services or products to ensure profitability the company has no other option but to reposition its services or products that would cater to a new target segment of their existing market and ensure sales or profitability.

<h3>Reason</h3><h3 />

There could be many reasons for marketers repositioning their products.

  1. The products are evolving and getting more features into it. They needs to marketed differently in order to make the customers aware of the new features, add-ons. In this case, it is better to reposition the products.

8 0
2 years ago
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