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3 years ago

A Change in wages causes a

Business

1 answer:

MArishka [77]3 years ago

8 0

Answer:

A change in the wage or salary will result in a change in the quantity demanded of labor. If the wage rate increases, employers will want to hire fewer employees. The quantity of labor demanded will decrease, and there will be a movement upward along the demand curve.

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The current price of a stock is $22, and at the end of one year its price will be either $27 or $17. The annual risk-free rate i

e-lub [12.9K]

Answer:

Based on the binomial model, the option's value is $3.00

Explanation:

The stock range of payoffs in one year is $27 - $17 = $10.

At expiration, if the stock price is $27, the option will be worth

= $27 - $22

= $5

And the option will be worth zero, if the stock price $17.

The range of payoffs for the stock option is $5 & $0 ; 0 = $5.

Equalize the range to find the number of shares of stock:

Option range/Stock range = $5/$10

= 0.5

With 0.5 shares, the stock options payoff will be either $13.5 or $8.5. The portfolio & options payoff will be

$13.5 - $5 = $8.5, or $8.5 $0; 0 = $8.5.

The present value of $8.5 at the daily compounded risk-free rate is: PV = $8.5 / (1+ (0.06/365))365 = $8.005.

The option price is the current value of the stock in the portfolio

minus the PV of the payoff: V = 0.5($22) - $8.005 = $3.00.

Therefore, Based on the binomial model, the option's value is $3.00

7 0

3 years ago

An outside supplier offers to provide Epsilon with all the units it needs at $63.05 per unit. If Epsilon buys from the supplier,

ICE Princess25 [194]

Answer:

Make since the relevant cost to make it is $59.05

Explanation:

Calculation to determine what Epsilon should choose to:

Relevant costs to make = 8.20 + 24.20 + [41*(100%-35%)]

Relevant costs to make = 8.20 + 24.20 + (41*65%)

Relevant costs to make = 8.20 + 24.20 + 26.65

Relevant costs to make =$59.05

Therefore Epsilon should choose to: MAKE SINCE THE RELEVANT COST TO MAKE IT IS $59.05

8 0

3 years ago

The difference between nominal GDP and real GDP is that:

Elenna [48]

Answer:

a. real GDP adjusts the value of goods for changes in the price level and nominal GDP does not.

Explanation:

The nominal GDP is calculated by using current prices without adjusting the inflation factor int the prices of goods that are accounted for in the total GDP value. On the other hand the real GDP is calculated by adjusting inflation int he pricesof the goods which included in total GDP value. So the correct option is a. real GDP adjusts the value of goods for changes in the price level and nominal GDP does not.

4 0

3 years ago

Rida, Inc., a manufacturer in a seasonal industry, is preparing its direct materials budget for the second quarter. It plans pro

exis [7]

Answer and Explanation:

The preparation of the direct material budget for the second quarter is presented below:

Rida Inc

Direct Materials Budget Second Quarter

Units to be produced 240,000 units

Materials requirement per unit 0.60 pounds

Materials needed for production (pounds) 144,000 pounds

Add: Budgeted ending inventory (pounds) 9,450 pounds

(52,500 units × 0.60 pounds × 30%)

Total materials requirements (pounds) 153,450 pounds

Less: Beginning inventory (pounds) 43,200 pounds

Materials to be purchased (pounds) 110,250 pounds

Multiply Material price per pound $175

Budgeted cost of direct materials $19,293,750

We added the ending inventory and deduct the beginning inventory to the production units so that the purchased units could come and then multiply it with the material price per pound so that the budgeted cost could come

7 0

4 years ago

The primary purpose of closing entries is to:Prove the equality of the debit and credit entries in the general journal.Ensure th

strojnjashka [21]

Answer:

The answer is : to Update the balance of Retained Earnings and prepare revenue, expense, and dividend accounts for next period's transactions

Explanation:

The closing entries is to set the accounts' balance of temporary account to zero by transferring these balance to other permanent accounts at the end of the accounting cycles.

Temporary accounts includes accounts of revenues and expenses and dividend payment. Permanent account is Retained Earnings.

As Revenues and expenses are recorded for an accounting period, their balances should be all transferred to Retained Earnings account, together with the dividend payment during the period, to determined the ending balance of Retained Earning account at the end of the accounting period.

Once the closing entries has been recorded, the balance of all revenues and expenses, dividend payments accounts will be set back to zero at the start of next account period for recording revenue and expenses taken place in that period only. While Retained Earning Balance will show how much accumulated Earnings a firm retained since the start of its business.

3 0

4 years ago