Answer:
$3,310.20
Explanation:
The applicable formula in this case is
A = P x ( 1 + r )^ n
Where A= amount after 20 years
P is principle amount= $1000
r is interest rate = 6 % or 0.06 per year: monthly interest = 0.06/12
n is number of periods = 12 months x 20 years
A = $1000 x ( 1 + 0.005) ^240
A = $1000x (1.005) ^ 240
A =$1000 x 3.31020447580
A =$3,310.2044
Answer:
The two optimal two part price that would be suggested to Verizon is Unit per Fee = $1 and Lump Sum fee or fixed fee = $99
Explanation:
Solution
For us fully maximize profit under two part price It should gives that amount of wireless service at which P = MC and and also charge Lump sum fee or fixed fee equals to the consumers surplus that consumer will have.
Now,
marginal cost= MC = 1 and P = 100 - 25Q.
Thus,
P = MC => 100 - 25Q = 1 => Q = 2
Then,
The Consumer surplus is the above area Price of line which is (iP = 1) and below is the curve of demand
Now,
P = 100, When Q = 0 The Consumer surplus = (1/2)*base*height
= (1/2)*(100 - 1)*2 = 99
Therefore, Fixed fee or The Lump Sum fee = 99
However, the Optimal two part pricing is denoted by:
The Unit per Fee = $1 and Lump Sum fee or fixed fee = $99
Answer: Option A
Explanation: In simple words, elasticity refers to the change in demand for a product due to change in its price.
If the price for the gasoline remains high in the long run then at one point substitution effect will come into play and consumers will shift their demand to the alternatives available.
However the product like gasoline will not show decrease in demand in the short run due to price as it more of an essential good to daily life.
Thus, the correct option is A.
Answer:
Hornberger plows back 22.72% of its earnings into the firm.
Explanation:
Plowback ratio fundamental analysis ratio that measures how much earnings are retained after dividends are paid out.
We can use the relationship g = ROE × b to find the plowback ratio (b).
The growth rate implied by the recent dividend and the expected dividend is estimated using the equation, D1 = D0 × (1 + g)
$2.05 = $2.00 × (1 + g)
$2.05 - 2.00 = 2.00g
0.05 / 2 = g
g = 2.5%
Then according to the equation (b)
2.50% = 11.00% × b
b = 2.50%/11.00%
b = 22.72%
