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4 years ago

Explain the importance of elasticity

2 answers:

8 0

Elasticity of demand can help us decide which prices are suitable for the products we sell. If a price is inelastic even when the price goes up, it tells the business that they can increase the price if they want however if the price is elastic, it will change drastically when prices go up. This means businesses would have to find the equilibrium price where demand and supply meets in the middle.
hope this helps x

erma4kov [3.2K]4 years ago

5 0

Elasticity is important to pricing decisions because it helps us understand whether raising prices or lowering prices will enable us to achieve our pricing objectives.

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An electronic firm invested $60,000 in a precision inspection device. It cost $4000 to operate and maintain in the first year an

Anon25 [30]

Answer:

$9,287.63

Explanation:

Data provided in the question:

Amount invested = $60,000

Operating cost for the first year = $4000

Operating and maintaining cost after 1 year = $3,000

Selling price = $60,000

Now,

Amount paid extra in the year 1 = $4,000 - $3,000

= $1,000

EUAC ($)

= $60,000 × A/P(10%, 4) + $3,000 + $1,000 × P/F(10%, 1) × A/P(10%, 4) - [ $60,000 × P/F(10%, 4) × A/P(10%, 4) ]

= [ $60,000 × 0.3155 + 3,000 + 1,000 × 0.9091 × 0.3155 ] - [ 60,000 × 0.6830 × 0.3155 ]

= [ $18,930 + $3,000 + $286.82 ] - [ $12,929.19 ]

= $9,287.63

5 0

3 years ago

On January 2, 2021, Miller Properties paid $28 million for 1 million shares of Marlon Company's 6 million outstanding common sha

emmainna [20.7K]

Answer:

A. Income statement $8.4 million

B. Balance sheet million $35.4 million

C. Operating cash flow million $1 million

Investing cash flow million=$28 million

Explanation:

a. Calculation for Income statement million

Using this formula

Income statement=Investment revenue -Patent amortization adjustment

Let plug in the formula

Income statement= ($54 million × 1/6)-([$36 million] × 1/6]÷10 years)

Income statement=$ 9.0-$0.6

Income statement=$8.4 million

Therefore Income statement million will be $8.4 million

b. Preparation of the Balance sheet million

Cost $28 million

Add Investment revenue $9.0 million

($54 million × 1/6)

Less Dividend ($1 million)

($6 million × 1/6)

Less Patent amortization adjustment ($0.6 million)

([$36 million] × 1/6]÷10 years)

Balance sheet million $35.4 million

($28 million+$9.0 million-$1 million-$0.6 million)

Therefore Balance sheet million will be $35.4 million

c. Preparation of the Statement of cash flows

Operating cash flow million=($6 million × 1/6)

Operating cash flow million= $1 million

Investing cash flow million=$28 million

Therefore Operating cash flow million will be $1 million while the Investing cash flow million will be $28 million.

5 0

3 years ago

The accompanying graphs depict the market for bags of potato chips, which is currently at an equilibrium price of $1.67 per bag

Sergeeva-Olga [200]

Answer:

Equilibrium is the point of the interaction between the demand and supply curves.

The given graph given from the question is attached below (Image 1-2)

The solution is attached in image 3-4

6 0

3 years ago

Assume that you have entered into a swap agreement for a notional of 100M USD under which every 6 months you agree to pay LIBOR

hodyreva [135]

Answer:

C) 0.5 USD

Explanation:

Swap is an arrangement in which two parties exchange their interest rates for mutual benefit. One party may receive fixed rate and other will receive floating rate based on LIBOR. In the given scenario the swap agreement was originated when the LIBIOR was 3%. The fixed rate was set to be at 4% so the net gain at the time of inception was 1%. When LIBOR increased after six month the net gain declined to only 0.5%.

4 0

3 years ago

The adjusted trial balance for Chiara Company as of December 31 follows.

dangina [55]

Answer:

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mnbvcxz

7 0

3 years ago

Explain the importance of elasticity​

Explain the importance of elasticity