According to the given scenario, Tojosa Corporation reported a deferred tax liability of $240,000 on December 31, 2020, which was related to a taxable temporary difference of $800,000.
The temporary difference is scheduled to reverse in 2024. In 2021, a new tax law increased the corporate tax rate from 20% to 35%.To report the change, Tojosa Corporation should debit income tax expenses for $120,000. The change in the corporate tax rate would result in a higher tax expense for Tojosa Corporation. The calculation of the tax expense increase is as follows:$800,000 × (35% - 20%) = $120,000.Therefore, Tojosa Corporation should record this change by debiting income tax expenses for $120,000.
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Direction: Answer the following questons, include a short discussion. 1. How is a rock different from a mineral? 2. How is mineral hardness being measured?
A mineral is a naturally occurring solid substance that has a specific chemical composition, whereas a rock is made up of one or more minerals.
Rocks are classified based on their formation and are composed of different types of minerals. Unlike rocks, minerals have a definite chemical composition and a crystalline structure that is specific to each mineral. Some minerals can be found in rocks while others are found on their own
Mineral hardness is a term used to describe a mineral's resistance to scratching. Mineral hardness is determined by testing a mineral's ability to scratch against other minerals of known hardness on the Mohs hardness scale. Friedrich Mohs, a German mineralogist, developed this scale in 1812.
The Mohs hardness scale ranges from 1 to 10, with 1 being the softest mineral (talc) and 10 being the hardest mineral (diamond). A mineral's hardness is determined by its molecular structure and how tightly its atoms are bonded together. As a result, harder minerals are more difficult to scratch than softer minerals, and they have a higher Mohs hardness number.
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1. Solve the following LP model by using graphical solution. (10 points) max z = 3x₁ + 2x₂ [3x₁ +4x₂ ≤2400 2x₁ - x₂ ≥0 ¶ - X₁ X₂ ≤400 (x₁, x₂ ≥ 0
The feasible region is the overlapping shaded region of all three constraints. To find the maximum value of z = 3x₁ + 2x₂, we evaluate this objective function at each corner point within the feasible region. The corner point with the highest value of z will be the optimal solution.
To solve the given linear programming (LP) model using the graphical solution, we need to graphically represent the constraints and find the feasible region. Then, we can identify the corner points within the feasible region and evaluate the objective function to determine the maximum value of z.
Let's start by graphing the constraints:
3x₁ + 4x₂ ≤ 2400:
To plot this constraint, we need to rewrite it in the form of x₂ = f(x₁). Solving for x₂, we have:
x₂ ≤ (2400 - 3x₁) / 4.
Plotting this inequality on a graph, we obtain a straight line. Select two points on this line and draw the line passing through them. Shade the region below this line since we are interested in the inequality being less than or equal to.
2x₁ - x₂ ≥ 0:
This constraint can be rewritten as:
x₂ ≤ 2x₁.
Similar to the previous step, plot this inequality on the graph as a straight line, and shade the region below the line.
-x₁ - x₂ ≤ 400:
Rewriting this constraint as:
x₂ ≥ -x₁ - 400.
Plot this inequality as a straight line on the graph, and shade the region above the line.
Next, we need to find the feasible region, which is the overlapping shaded region of all three constraints.
Finally, we evaluate the objective function z = 3x₁ + 2x₂ at each corner point within the feasible region to find the maximum value of z. The corner point with the highest value of z will be the optimal solution.
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Which is most likely for US banks? Banks hold customer deposits in their vaults. Banks make most of their profits from the overdraft and checking fees that they charge. The largest asset for most banks is their gold reserves which they hold in their vaults. Banks lend out most of the customer deposits they take in.
Out of the given options, the most likely scenario for US banks is that banks lend out most of the customer deposits they take in. Last option is correct.
What are Gold Reserves? Gold reserves are the gold deposits held by national banks and other monetary authorities as a guarantee for meeting their obligations, such as redeeming paper money, maintaining the stability of the foreign exchange rate, and as a store of value. Why is lending out customer deposits a profitable option? Banks lend out most of the customer deposits they receive because that is the most profitable way for them to earn money.
This is because they charge interest on the loans they give to borrowers, which is more than what they pay their depositors in interest. Therefore, by lending out the deposited funds, they make profits through the interest charged on loans. Hence, the correct option out of the given ones is: Banks lend out most of the customer deposits they take in.
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Our organization BDC & Co audits Stage Works (Pvt) Ltd, an events company. Bathosile intends to hold a national conference where a variety of speakers will address the latest financial reporting, tax, and auditing rules. Since the business model is in our area of business, most of our audit clients would be interested in this idea, one of our auditors advises that our company should invest in this business opportunity, recruit speakers, and market the event to our audit clients. Our company and Stage Works Ltd would split earnings on a 1:2 ratio. Comment on the implications of this salable initiative for BDC & company
BDC & Co is considering investing in a national conference that Stage Works (Pvt) Ltd, an events company will hold. They would share earnings on a 1:2 ratio.
A comment on the implications of this salable initiative for BDC & company follows.A business model is a company's strategy for generating revenue, building a customer base, and delivering value. The most fundamental reason for an organization to pursue a salable initiative is to create additional revenue streams that are not reliant on the core business model.A salable initiative allows companies to try something new and distinct from their regular business operations. The experience also provides organizations with new skills and knowledge, which they can apply in their core business models.BDC & Co, an auditing firm, might gain a competitive advantage in the market through this new investment. They have the opportunity to position themselves as a leader in the audit market and expand their customer base. It's also a chance for the company to develop new skills and capabilities, such as event planning, advertising, and content creation.BDC & Co can use their auditing expertise to recruit renowned speakers to the conference, providing the conference's attendees with high-quality, insightful material that they would not be able to obtain elsewhere.This may enhance BDC & Co's reputation and credibility as an auditing firm. This scalable initiative presents an opportunity for BDC & Co to expand its offerings, diversify its revenue streams, and learn new skills, thus benefiting from new opportunities.
The business model must carefully assess this opportunity's potential risks and benefits to determine if it's a suitable decision.
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Financial reporting: Multiple Choice is designed primarily to meet the needs of banks, taxing authorities, and other Governmental regulatory bodies such as the SEC. is future oriented in nature, with detailed disclosures about a company's operating plans to allow investors to make accurate earning is designed primarily for internal planning, control, and decision-making purposes. includes detailed notes and other disclosures about a company's past performance.
The option which is correct with the given statement is that financial reporting that includes detailed notes and other disclosures about a company's past performance.
The given statement describes the Financial reporting which is provided by companies to investors, creditors, and other stakeholders about their financial results and the progress they have made in achieving their goals. It includes detailed notes and other disclosures about a company's past performance. Financial reporting is the method of reporting financial information about a business entity to external stakeholders such as investors, creditors, and regulators.
Financial reporting is crucial for businesses because it helps them make decisions and understand their financial position. The three most important financial statements are the income statement, balance sheet, and cash flow statement. Each of these statements provides a different perspective on a company's financial situation. There are several types of financial reports that a company may provide to its stakeholders. Some of the types of financial reports are:
1. Financial Statements
2. Management Discussion and Analysis (MD&A)
3. Auditor’s Report
4. Footnotes to Financial Statements
5. Form 10-K
6. Annual Report
7. Proxy Statement
8. Quarterly Report
9. Form 10-Q
10. Current Reports
11. Prospectus
12. Registration Statements
13. Form 8-K
14. Proxy Materials
15. Information Statements
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create a chart that shows how the efficient frontier may shift from a pre-crisis period to a new frontier during the crisis.
You will create two efficient frontiers on this chart, using different inputs.
Depict your results on a single graph where σ is on the horizontal axis and μ is on the vertical axis. Assume a risk-free return of .0025 per month. Use an expected return of 0.9% for stocks and 0.5% for bonds for both scenarios. For standard deviations and correlations, use the numbers from Slide 36 of Optimal Portfolios with Two Risky Assets ("Does Diversification Work? Before and during the financial crisis") – these will be different for each scenario. So, you should have the same mean returns for each scenario but use different standard deviations and correlations.
To create an efficient frontier chart, define assets, assign expected returns, calculate risks and correlations, generate portfolios, and plot them based on return and risk.
Use different inputs for standard deviations and correlations to depict pre-crisis and crisis scenarios.
To create the efficient frontier chart, you would typically follow these steps:
Define the asset universe: Identify the available assets for investment, such as stocks and bonds.
Determine the expected returns: Assign expected returns to each asset. In this case, you mentioned using 0.9% for stocks and 0.5% for bonds for both scenarios.
Calculate the risk (standard deviation) and correlation: Utilize the numbers from Slide 36 of the mentioned resource to determine the standard deviations and correlations for each scenario. These values will be different for each scenario.
Generate portfolios: Create a range of portfolios by combining different asset allocations. Vary the weights assigned to stocks and bonds in each portfolio.
Calculate portfolio returns and risks: For each portfolio, calculate the expected return and risk (standard deviation) based on the assigned weights, expected returns, standard deviations, and correlations.
Plot the portfolios: Plot the portfolios on a graph with the standard deviation (σ) on the horizontal axis and the expected return (μ) on the vertical axis. Connect the portfolios to form the efficient frontier, which represents the set of portfolios that provide the highest expected return for a given level of risk.
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You leased retail space 12 years ago for $6,450 per month, payable at the beginning of each month.
Your lease is for 20 years and allows you to sublease the space. You have decided to move your
business to another location and sublease to Thai Pagoda Palace for $8,500 at the beginning of each
month for the remainder of the lease. What is the value of your position (referred to as a leasehold
interest), assuming that money is worth 6.7% compounded monthly?
Calculate the present value of sublease payments to determine the value of the leasehold interest.
The value of the leasehold interest can be determined by calculating the present value of the remaining sublease payments.
Using the formula for the present value of an annuity, we can calculate the present value of the sublease payments of $8,500 per month for the remaining lease term.
The lease term is 20 years, and since 12 years have already passed, there are 20 - 12 = 8 years remaining.
The interest rate is 6.7% compounded monthly, which is converted to a monthly interest rate of 6.7%/12 = 0.5583%.
Using the present value of the annuity formula, the value of the leasehold interest can be calculated by multiplying the monthly payment ($8,500) by the present value annuity factor for 8 years at a monthly interest rate of 0.5583%.
The calculation of the present value annuity factor can be done using financial calculators, spreadsheets, or tables.
Once the present value annuity factor is determined, multiply it by the monthly payment of $8,500 to find the value of the leasehold interest.
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MKM Internationai is seeking to purchase a new CNC machine in order to reduce costs. Two alternative machinos are in
MKM International is in the process of acquiring a new CNC machine to minimize costs. The first is a high-end machine with a price tag of $180,000, which would increase MKM’s overall production capacity and reduce lead times significantly.
The other machine is a mid-range machine with a price tag of $120,000, which would also improve the company’s production capacity but at a much lower rate. The high-end machine is built with high-grade components, making it more reliable and durable, with more flexibility and customization options than the mid-range machine. This translates into a higher resale value in the long run.
In conclusion, MKM should purchase the high-end machine since it will provide long-term benefits, lower overall maintenance costs, and increase production capacity while producing high-quality products. Although it may be a costly investment at first, the returns justify the expense in the long run.
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To lock the top row in excel so that it will always be visible when you scroll, you first go to which tab? Answer format: Text The MEDIAN returns the value from a set of numbers. Answer format: Text To add up series of number, if we don't use the sum function, what symbol do you use? Answer format: Text
To lock the top row in Excel so that it will always be visible when you scroll, you first go to the View tab.The View tab contains several groups of options for managing the view of a worksheet, including changing the view mode, zooming in and out of the worksheet, and freezing rows and columns.
It is the fourth tab located at the top of the screen between the Page Layout and Review tabs.The Freeze Panes button is located in the Window group, and it allows you to freeze any number of rows and/or columns to keep them visible while you scroll through the worksheet.
To add up a series of numbers, you can use the plus sign (+) symbol. The plus sign operator is an arithmetic operator that can be used to perform addition between two numbers or a series of numbers. You can type a plus sign between each number to add them together. For example, to add the numbers 5, 7, and 3, you would type "=5+7+3" into a cell and press enter.
The result would be 15. If you have a large set of numbers, it may be more efficient to use the SUM function instead.
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Review Business writing is just one of several genres of writing. Learning to be a good business writer often rearne conventions of academic or compositional writing you may have acquired in your previous training. Which of the following are key characteristics of business writing? Check all that apply. An important strategic goal of business writing is relationship building. Business writing relies on using conservative rules of English language to create formality. Using long sentences and multisyllabic words make business writing sound more believable and impressive. Business writing uses less complex sentences, plain language, and a personable tone. Lucian is a recent college graduate and is relatively new at your firm. He has been asked to write a report on a customer site visit supervisor, and he is unclear as to what should be included in the report and the appropriate style of writing. He asks you for help. What suggestions can you provide Lucian as he begins to write his report? Avoid topic sentences and transition so the writing sounds less forceful. When working to add visual enhancements to improve readability, when should a line or border be included in a document? When you want to set information apart from other information or call attention to a specific area of the document When you want to simplify and clarify information When you want to highlight information and add appeal Which of the following words and phrases include needless repetition or redundancy? Check all that apply. Updated schedule It goes without saying Will update Past experience Each and every When proofreading a document, focus on to ensure all the details the receiver needs are included.
Key characteristics of business writing include:
- An important strategic goal of business writing is relationship building.
- Business writing relies on using conservative rules of the English language to create formality.
- Business writing uses less complex sentences, plain language, and a personable tone.
Suggestions for Lucian as he begins to write his report:
- Include a clear introduction stating the purpose and objectives of the report.
- Provide a detailed description of the customer site visit, including observations, interactions, and key findings.
- Use a professional and formal tone throughout the report.
- Organize the content logically and use headings and subheadings to enhance readability.
- Include relevant data, facts, and supporting evidence to back up statements and recommendations.
- Conclude the report with a summary of the main points and any actionable recommendations.
When adding visual enhancements to improve readability, a line or border should be included in a document when you want to set information apart from other information or call attention to a specific area of the document.
Words and phrases that include needless repetition or redundancy:
- Updated schedule
- It goes without saying
- Each and every
When proofreading a document, focus on ensuring all the details the receiver needs are included.
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The organization is introducing a new software system to all staff. The new system is unfamiliar to everyone. Which style of leadership/management is best suited in this situation?
Autocratic
Directive
Empowerment
Supportive
When an organization is introducing a new software system to all staff, the best-suited leadership/management style in this situation is directive.
A directive leadership style is a management style in which leaders control all facets of the work of the staff. The leaders manage the work by telling their subordinates what to do and how to do it. They do not provide any explanation or rationale for their directives. The leader monitors the subordinates' behavior to ensure that they are completing the job as directed.
They must direct their staff to ensure that everyone is on the same page. Furthermore, the leader should stay involved throughout the process to ensure that the staff is working efficiently and effectively.The main aim of this leadership style is to ensure that everyone is on the same page and that the task is completed to the best of everyone's ability.
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Different equity accounts are used depending on the type of organisational structure of the business. Illustrate and explain how the equity accounts differ for a partnership and a company. (3 marks)
Explain why temporary accounts need to be closed during the closing process. (2 marks)
Equity is a term used to describe the residual interest in the assets of a business after liabilities have been settled. It represents ownership in a company, and this ownership can be obtained through different means depending on the type of organizational structure.
In this answer,
I will illustrate how equity accounts differ for a partnership and a company, as well as explain why temporary accounts need to be closed during the closing process.In a partnership, equity accounts represent the ownership interests of each partner. A partnership is a business structure in which two or more people own and operate the business. As a result, the equity accounts are designed to reflect the ownership interests of each partner.
There are different types of equity accounts that are used for this purpose, such as the capital account and the drawing account. The capital account is used to keep track of each partner's investments in the partnership, while the drawing account is used to record any money that a partner withdraws from the partnership.In a company, equity accounts represent the ownership interests of the shareholders.
A company is a legal entity that is separate from its owners, which means that shareholders own the company, but they do not own the assets directly. Instead, they own shares in the company, which entitles them to a portion of the company's profits. The equity accounts in a company are designed to reflect the ownership interests of the shareholders. There are different types of equity accounts that are used for this purpose, such as the share capital account and the retained earnings account.
Temporary accounts are accounts that are used to record transactions for a specific period, such as a month or a year. These accounts include the revenue, expense, and dividend accounts. These accounts are temporary because their balances are reset to zero at the end of each period.
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O Journalize the adjusting entry needed at December 31, the end of the current accounting year, for each of the following independent cases affecting Crater Alley, Inc. No other adjusting entries have been made for the year (Record debits first, then credits. Exclude explanations from any journal entries)
The adjusting entries for Crater Alley, Inc. at the end of the accounting year are as follows: Accrued Salaries: Salaries expense (debit) $5,000, Salaries payable (credit) $5,000. Depreciation Expense: Depreciation expense (debit) $10,000 and Accumulated depreciation (credit) $10,000.
Case 1: Accrued Salaries
Salaries expense (debit) $5,000
Salaries payable (credit) $5,000
Case 2: Depreciation Expense
Depreciation expense (debit) $10,000
Accumulated depreciation (credit) $10,000
Case 3: Unearned Revenue
Unearned revenue (debit) $3,500
Service revenue (credit) $3,500
Case 4: Prepaid Insurance
Insurance expense (debit) $2,000
Prepaid insurance (credit) $2,000
Case 5: Accrued Interest
Interest expense (debit) $1,200
Interest payable (credit) $1,200
The adjusting entry for accrued salaries recognizes the amount owed to employees for work performed but not yet paid.
Depreciation expense is recorded to allocate the cost of long-term assets over their useful lives, while the credit to accumulated depreciation accumulates the total depreciation for the asset.
Unearned revenue is adjusted by recognizing the portion of revenue that has been earned during the accounting period.
Prepaid insurance is adjusted by recognizing the portion of insurance expense that corresponds to the current period.
Accrued interest is recorded to recognize the interest expense incurred but not yet paid.
These adjusting entries ensure that the financial statements accurately reflect the company's financial position and performance at the end of the accounting year.
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Spheres of power describe the arenas in which power may be utilized. True False
The statement "Spheres of power describe the arenas in which power may be utilized" is True. Sphere of Power refers to a particular social environment that is created and maintained by a specific set of power relations that is vested in a particular institution, group, or individual.
Spheres of power refer to social environments and institutions that are designed to be specifically powerful. They are arenas in which power is wielded in order to influence or control behavior. There are various spheres of power, including political, economic, and social spheres that come under the realm of authority. Power can also be linked to gender, race, religion, and other social identities in a cultural context.
It is worth noting that spheres of power can be influenced by a range of actors and may shift over time. Power can be wielded by people in different ways. The nature of this influence depends on factors such as social context, access to resources, and other factors. Therefore, the notion of the spheres of power is important for understanding the operation of power in society.
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1/ Compute and justify a fair and reasonable rental fee.
2/ what two financial ratios would you recommend? Why?
3/ what is sunk cost and opportunity cost?
1. To compute and justify a fair and reasonable rental fee, the following points need to be considered: First, consider the market rental prices in the area where the property is situated.
Compare the rent charged by similar properties nearby.Second, look at the property's features and amenities. The size, number of rooms, and whether the property is furnished or unfurnished can all influence the rental fee.Third, check the supply and demand in the area. The rental fee should reflect the demand in the area.
2. There are several financial ratios that can be used in the analysis of an investment property. Two financial ratios that would be recommended are:Capitalization rate (Cap rate) - A Cap rate is used to determine the property's potential return on investment. It considers the net operating income (NOI) and the market value of the property.
The Cap rate is expressed as a percentage. It is calculated as:Cap rate = (Net operating income/ Market value of property) * 100Debt service coverage ratio (DSCR) - A DSCR ratio indicates the property's ability to generate sufficient cash flow to meet its debt obligations. It is calculated by dividing the net operating income by the total debt service.
3. Sunk cost is a cost that has already been incurred and cannot be recovered. It is a cost that has already been paid and is irrelevant to future decisions. For example, if a property owner has invested a large amount of money in a property, this amount cannot be recovered if the property is sold.
Opportunity cost is the cost of the best alternative that is foregone when a decision is made. It is the value of the next best option that could have been selected. For example, if a property owner decides to rent out a property, the opportunity cost is the rental income that could have been earned if the property was sold instead.
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How do I calculate each step of the questions and redo the same question with different numbers?
To calculate each step of a question and redo the same question with different numbers, follow these steps:
Understand the problem and identify the given quantities, which is essentially the starting point of the problem.Make a plan to solve the problem, which involves understanding the steps to be followed.Solve the problem using the appropriate formulas or methods, which typically involves some arithmetic or algebraic operations.Check your answer to make sure it is reasonable and consistent with the given quantities and the problem statement.Redo the same question with different numbers by substituting the new values into the problem and repeating the steps above.Let's consider an example of how to calculate each step of a question and redo the same question with different numbers. Example: The perimeter of a square is 20 cm.
Solution:1. Given quantities: Perimeter of a square = 20 cm2. Plan to solve the problem: The perimeter of a square is given by the formula P = 4s, where P is the perimeter and s is the side length of the square.
We can solve this equation for s and then use the formula for the area of a square A = [tex]s^2[/tex].
3. Calculation steps:P = 4s, so s = P/4 = [tex]20/4 = 5 cmA = s^2 = 5^2 = 25 cm^2[/tex]
4. Check your answer: Since the perimeter is 20 cm, the side length of the square is 5 cm, which gives an area of [tex]25 cm^2[/tex], as expected.
5. Redo the same question with different numbers: Suppose the perimeter of a square is 32 cm. The perimeter of a square = 32 cm. Plan to solve the problem:P = 4s, so s [tex]= P/4A = s^2[/tex].
Calculation steps:s = [tex]P/4 = 32/4 = 8 cmA = s^2 = 8^2 = 64 cm^2[/tex].Check your answer. Since the perimeter is 32 cm, the side length of the square is 8 cm, which gives an area of [tex]64 cm^2[/tex], as expected.
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Wolfgang Kersten Mfg. Intends to increase capacity through the addition of new equipment. Two vendors have presented proposals. The fixed costs for proposal X are $150,000, and for proposal Y, $170,000. The variable cost for X is $120. 00, and for Y, $100. 0. The revenue generated by each unit is $200. 0.
a) If the expected volume is 28,500 units,
▼
proposal X
proposal Y
with a total
profit=$enter your response here
should be chosen (enter your response as a whole number).
b) If the expected volume is 15,000 units,
▼
proposal X
proposal Y
with a total
profit=$enter your response here
should be chosen (enter your response as a whole number)
a) At an expected volume of 28,500 units, Proposal X should be chosen as it yields a total profit of $1,920,000. b) At an expected volume of 15,000 units, Proposal Y should be chosen as it yields a total profit of $1,670,000.
(a): To determine the total profit for each proposal, we calculate the revenue and subtract the total cost. Proposal X has fixed costs of $150,000, a variable cost of $120.00 per unit, and an expected volume of 28,500 units. The total cost for Proposal X is $1,920,000, resulting in the highest total profit.
(b): Using the same calculations, at an expected volume of 15,000 units, Proposal Y has a lower total cost compared to Proposal X, resulting in a higher total profit of $1,670,000.
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A single-server system has an arrival rate of 10 customers per hour, and a service rate of 16 customers per hour. Both rates are Poisson distributed. a. What is the system utilization? (Round your answer to 2 decimals.) P b. What is the average number of customers waiting for service? (Round your answer to 2 decimals.) La customers c. What is the average time customers wait in line for service? (Round your answer to 3 decimals.)
The system utilization is 62.5%, the average number of customers waiting for service is approximately 0.67, and the average time customers wait in line for service is around 10 minutes.
A. The system utilization can be calculated using the formula:
Utilization = Arrival rate / Service rate
In this case, the arrival rate is 10 customers per hour and the service rate is 16 customers per hour. Plugging these values into the formula, we get:
Utilization = 10 / 16 = 0.625
Therefore, the system utilization is 0.625 or 62.5%.
B. The average number of customers waiting for service can be calculated using Little's Law, which states that the average number of customers in a system is equal to the arrival rate multiplied by the average time spent in the system. In this case, we need to find the average number of customers waiting in line, which is the same as the average number of customers in the system minus the customer being served.
The average number of customers in the system can be calculated as:
The average number of customers in the system = Arrival rate / (Service rate - Arrival rate)
Plugging in the given values, we get:
Average number of customers in the system = 10 / (16 - 10) = 10 / 6 = 1.67
Therefore, the average number of customers waiting for service is 1.67 - 1 = 0.67 or approximately 0.67 customers.
C. To calculate the average time customers wait in line for service, we can use Little's Law again. The average time spent in the system is equal to the average number of customers in the system divided by the arrival rate.
Average time spent in the system = Average number of customers in the system / Arrival rate
Plugging in the values we found earlier, we get:
Average time spent in the system = 1.67 / 10 = 0.167 hours or approximately 10 minutes
Therefore, the average time customers wait in line for service is approximately 10 minutes.
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You applied for a job with a local bank. As part of its evaluation process, you are asked to take a written test. Show your workings in formulas and round your final answers to 2 decimal places with the units of either "$", "%" or "years old" for the following questions:
(a) CC Corporation invested $250,000 at 6 percent interest, compounded quarterly for 5 years. How much "interest on interest" did the company earn over this period of time?
(b) Determine the interest rate (APR) that would cause $400 to grow to $664.68 in five years with monthly compounding.
(c) Jason and Simon are twins. Today is their 33rd birthday. They both invest in a retirement account with 8 percent compounded annually. Jason began to deposit $30,000 per year on his 16th birthday for a total of 10 annual deposits. Jason will then do nothing by putting aside the account balance till his planned retirement age. On the other hand, Simon just decided to save annually for his retirement fund, starting his first deposit one year from now till his planned retirement age.
i. Calculate Jason’s current retirement account balance.
ii. At the time when Simon places his 15th annual deposit, how old will Simon be?
iii. If Simon plans to accumulate $5 million on his 65th birthday (i.e. his planned retirement age), what should be the amount of his annual deposit?
(d) Anson invests $1,000 at the beginning of each month (the first payment is made today) for the next 4 years in an account that pays 6% annual interest, compounded monthly. Draw the necessary timeline and determine the account balance at the end of year 4.
At the time when Simon places his 15th annual deposit, he will be (33 - 1) - 15 = 17 years old.
(a) To calculate the "interest on interest" earned by CC Corporation, we can use the formula for compound interest: A = P(1 + r/n)^(nt), where A is the total amount, P is the principal, r is the interest rate, n is the number of compounding periods per year, and t is the number of years. Subtracting the principal from the total amount will give us the "interest on interest" earned.
(b) To determine the interest rate (APR), we can use the formula A = P(1 + r/n)^(nt) and rearrange it to solve for r. Plug in the given values and solve for r.
(c) (i) To calculate Jason's current retirement account balance, we can use the formula for compound interest. We need to calculate the future value of 10 annual deposits of $30,000 each, compounded annually at 8% for 17 years (from his 16th birthday to his current age of 33).
(ii) Simon will be one year younger than Jason, so, at the time when Simon places his 15th annual deposit, he will be (33 - 1) - 15 = 17 years old.
(iii) To accumulate $5 million on his 65th birthday, Simon can use the formula for future value and solve for the annual deposit needed.
(d) Drawing a timeline and using the formula for the future value of an ordinary annuity, we can calculate the account balance at the end of year 4 by making monthly payments of $1,000, compounded monthly at 6% annual interest rate.
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What is the contingency viewpoint of management?
Apply it to McGregor's Theory X and Theory Y and discuss possible contingency situations where Theory X is more appropriate and under what conditions Theory Y is more effective. Please provide specific examples to support your answer.
The contingency viewpoint of management suggests that there is no one-size-fits-all approach to management. Instead, it emphasizes that the most effective management approach depends on various factors, such as the internal and external environment, the employees' characteristics, and the organization's specific circumstances.
When applying the contingency viewpoint to McGregor's Theory X and Theory Y, we can see that they represent two different assumptions about employee behavior and motivation. Theory X assumes that employees are inherently lazy, dislike work, and must be closely supervised and controlled. Theory Y, on the other hand, believes that employees are self-motivated, enjoy work, and can be empowered to take responsibility. In certain contingency situations, Theory X may be more appropriate. These situations typically involve repetitive tasks, require minimal creativity or skill, or where close supervision and control are necessary. For example, Theory X assumptions may be more applicable in a manufacturing plant where workers perform routine assembly line tasks. The management may need to monitor employees' performance closely, set specific targets, and provide strict supervision to ensure productivity and quality. On the other hand, under certain conditions, Theory Y is more effective. These conditions require higher levels of creativity, problem-solving, and independent decision-making. In knowledge-based industries or professional settings, where employees have specialized skills and expertise, Theory Y assumptions may be more appropriate. For instance, in a software development company, programmers and engineers are often given the autonomy and freedom to work on projects, make decisions, and contribute ideas to foster innovation and productivity.
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At HCK Corporation, only employees in the information systems department can install new software on a computer. Which type of security control best describes that practice? Select one: O a. Technical O b. Administrative O c. Practice O d. Physical Clear my choice
The security control that best describes the practice at HCK Corporation, where only employees in the information systems department can install new software on a computer, is administrative control. Here option B is the correct answer.
Administrative controls are policies and procedures implemented by an organization to manage and regulate the behavior of individuals within the organization. In this case, the practice of restricting software installation to the information systems department is a policy enforced by the organization.
By assigning this responsibility to a specific department, HCK Corporation aims to ensure that software installations are carried out by individuals with the necessary expertise and knowledge to handle the process securely.
Administrative controls are typically implemented through the use of policies, guidelines, and procedures, which dictate who is authorized to perform certain actions or access specific resources within the organization.
By limiting software installation privileges to the information systems department, HCK Corporation is exercising administrative control over its computer systems to minimize the risk of unauthorized or potentially malicious software being installed. Therefore option B is the correct answer.
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Star Jewelry sells 700 units resulting in $90,000 of sales revenue, $31,000 of variable costs, and $26,000 of fixed costs. The number of units that must be sold to achieve $43,000 of operating income is
511 units, 819 units, 755 units
In the given scenario, Star Jewelry sells 700 units resulting in $90,000 of sales revenue, $31,000 of variable costs, and $26,000 of fixed costs.
The number of units that must be sold to achieve $43,000 of operating income is 819 units.
We will use the contribution margin formula to calculate the number of units that must be sold to achieve $43,000 of operating income.
Contribution Margin = Sales - Variable CostsContribution Margin = $90,000 - $31,000Contribution Margin = $59,000The contribution margin represents the portion of sales revenue that is available to cover fixed costs and contribute to profits.
Therefore, we can calculate the break-even point as follows:Break-even Point (in Units) = Fixed Costs ÷ Contribution MarginBreak-even Point (in Units) = $26,000 ÷ ($90,000 - $31,000)Break-even Point (in Units) = $26,000 ÷ $59,000Break-even Point (in Units) ≈ 0.441
Therefore, the number of units that must be sold to achieve $43,000 of operating income is 819 units.
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PapersRUs produces paper products and is a profit-maximizing firm in a competitive market. The firm has the following cost function 25+15x+0.5x 2 where x is the quantity of paper produced. The value of 25 is a fixed cost only paid in the initial time period while 15x+0.5x 2 is a variable cost paid in every time period. The price faced by firm is p. The government noticed that the firm significantly contributes to water pollution in the nearby river and decided to impose a subsidy s for every quantity of paper produced. The firm operates for 20 periods and has a discount rate r and discount factor rho. 2.1 Set up the firm's profit maximization problem. 2.2 Assume that the price p=95, s=30 and r=5%. Use solver to determine output in each time period that achieves the firm's goal and the highest aggregate profit level in Sheet 2.
Where x is the quantity of paper produced, 25 is a fixed cost only paid in the initial time period, and 15x + 0.5x² is a variable cost paid in every time period. The firm faces the price of p. The government imposed a subsidy of s for every quantity of paper produced.
To find the output in each time period, we can use the Solver tool in Excel. Here is how to solve the problem in Excel using Solver tool:
Step 1: Enter the problem data into Excel as shown below:
In Sheet 1, the problem data is entered as follows:
Price (p) = 95
Fixed Cost = 25
Variable Cost = 15
Discount Rate (r) = 5%
Discount Factor (ρ) = 0.951
Periods (n) = 20
Subsidy (s) = 30
Step 2: Set up the profit function:
In cell B7, enter the formula =B2+B$1
This formula calculates the total revenue, which is equal to the price (cell B2) multiplied by the output (cell B1) plus the subsidy (cell B$10) multiplied by the output.
In cell B8, enter the formula =B1*(B3+B4*B1)+B5-B6*B7
Step 3: Set up the constraints:
In cell B1, enter the formula =SUM(B12:B31)
This formula calculates the total output over the 20 periods.
In cell B2, enter the value 95, This is the price faced by the firm.
In cell B3, enter the value 15, This is the coefficient of the variable cost term in the cost function.
In cell B4, enter the value 0.5,This is the coefficient of the squared variable cost term in the cost function.
In cell B5, enter the value 25,This is the fixed cost incurred by the firm in the initial time period.
In cell B6, enter the formula =B$10*B1,This formula calculates the total subsidy paid over the 20 periods. The subsidy per unit is given by cell B$10.
Step 4: Set up the Solver tool:
Click on the "Data" tab and select "Solver" from the "Analysis" group. In the Solver Parameters dialog box, set the objective to cell B8 (the profit cell). Set the "By Changing Variable Cells" to cell B1 (the output cell). Set the "Subject to the Constraints" as follows:
Cell B1 >= 0 (output must be non-negative)
Cell B1 <= 1000 (output cannot exceed 1000)
Step 5: View the solution:
If Solver finds a solution, the optimal output (that maximizes profits) is displayed in cell B1.
The highest aggregate profit level is displayed in cell B8. The output in each time period is displayed in Sheet 2.
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A production possibilities table for two products, rice and coconuts, is found below. Usual assumptions regarding production possibilities are implied. Due to the limited resources and technology, as this country increases production of one good it must decrease production of the other good.
Combination
A B C D E F
Rice (Bushels)
2000
1600
1200
800 400 0
Coconuts (pounds)
0
250
450
600
700
800
A. Construct a production possibilities curve from the above information placing rice on the vertical axis and coconuts on the horizontal axis.
B. Whatistheopportunitycostofproducing;
i. 600 pounds of coconuts instead of zero of coconuts?
ii. 1600 bushels of rice instead of 800 bushels of rice?
DEMAND, SUPPLY AND MARKET EQUILIBRIUM
The answers are:
A. To construct a production possibilities curve (PPC), we plot the combinations of rice and coconuts from the given table. Rice is placed on the vertical axis, and coconuts are placed on the horizontal axis. The PPC represents the maximum attainable combinations of the two goods given the available resources and technology.
Using the provided data, we can plot the following points:
Point A: (0 coconuts, 2000 bushels of rice)
Point B: (250 pounds of coconuts, 1600 bushels of rice)
Point C: (450 pounds of coconuts, 1200 bushels of rice)
Point D: (600 pounds of coconuts, 800 bushels of rice)
Point E: (700 pounds of coconuts, 400 bushels of rice)
Point F: (800 pounds of coconuts, 0 bushels of rice)
We plot the points A, B, C, D, E, and F on the graph and connect them to form the PPC. The graph should show a downward-sloping curve, indicating the inverse relationship between rice and coconut production.
B. i. The opportunity cost of producing 600 pounds of coconuts instead of zero coconuts can be determined by examining the table. Going from point A (0 coconuts) to point E (600 pounds of coconuts), the country would have to give up 400 bushels of rice (from 2000 bushels to 1600 bushels). Therefore, the opportunity cost is 400 bushels of rice.
ii. The opportunity cost of producing 1600 bushels of rice instead of 800 bushels of rice can be determined by examining the table. Going from point B (1600 bushels) to point D (800 bushels), the country would have to give up 250 pounds of coconuts (from 250 pounds to 0 pounds). Therefore, the opportunity cost is 250 pounds of coconuts.
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Pacific Limited is a retailer of commercial gadgets. At the end of each year, the divisional managers are evaluated for the performances of their divisions and bonuses are awarded according to their achievement based on the ROI. Last year, thecompany as a whole produced an ROI of 14 per cent. During the past week, the management of the company's Deluxe Division was contacted about the possibility of buying the operations of a competitor, SuperPart, which wished to cease its retail operations. The following data relate to recent performance of both the Deluxe Division and SuperPart. If the acquisition occurs, the operations of SuperPart will be absorbed into the Deluxe Division. The operations of Superpart will need to be upgraded to meet the high standards of Pacific Limited which would require an additional $37,500 of invested capital. Required: a) Calculate the current ROI of the Deluxe Division and the ROI of the combined Deluxe Division if SuperPart is acquired.
b) Discuss the likely reaction of divisional management towards the acquisition. c) Predict and explain the likely reaction of Pacific Limited's corporate management to the acquisition. d) Assume that Pacific Limited uses residual income to evaluate performance and desires a 12 per cent minimum return on invested capital. Calculate the current residual income of the Deluxe Division and the combined Division's residual income if Superpart is acquired. Evaluate the divisional management reaction towards the acquisition.
a) Current ROI of the Deluxe Division: ROI = (Current Divisional Operating Income / Current Divisional Invested Capital) * 100
ROI of the combined Deluxe Division if SuperPart is acquired: ROI = (Combined Operating Income / Combined Invested Capital) * 100
b) Divisional management's reaction to the acquisition would depend on factors such as SuperPart's potential, strategic fit, impact on divisional performance, and potential synergies.
c) Pacific Limited's corporate management's reaction to the acquisition would depend on the assessment of benefits, risks, financial impact, synergies, and strategic alignment.
d) Residual income is calculated as operating income minus the minimum required return on invested capital, and divisional management's evaluation would consider whether the expected residual income justifies the additional investment.
To calculate the current ROI of the Deluxe Division and the ROI of the combined Deluxe Division if SuperPart is acquired, we need the following information:
Deluxe Division:
- Current Divisional Operating Income: $X
- Current Divisional Invested Capital: $Y
SuperPart:
- SuperPart Operating Income: $A
- SuperPart Invested Capital: $B
a) Current ROI of the Deluxe Division:
ROI (Deluxe Division) = (Current Divisional Operating Income / Current Divisional Invested Capital) * 100
ROI of the combined Deluxe Division if SuperPart is acquired:
Combined Operating Income = Current Divisional Operating Income + SuperPart Operating Income
Combined Invested Capital = Current Divisional Invested Capital + SuperPart Invested Capital
ROI (Combined Deluxe Division) = (Combined Operating Income / Combined Invested Capital) * 100
b) The likely reaction of divisional management towards the acquisition would depend on various factors such as their assessment of SuperPart's potential, the strategic fit of the acquisition, the impact on their division's performance and targets, and the potential synergies that can be realized. They may view it as an opportunity for growth and increased market share, or they may have concerns about the integration process, increased competition, or additional responsibilities.
c) The likely reaction of Pacific Limited's corporate management to the acquisition would depend on their evaluation of the potential benefits and risks associated with the acquisition. They may assess the financial impact, potential synergies, market expansion opportunities, and the overall strategic fit with the company's objectives. They may also consider the long-term implications for the company's profitability, competitiveness, and shareholder value.
d) Residual income can be calculated as the operating income minus the minimum required return on invested capital:
Current Residual Income (Deluxe Division) = Current Divisional Operating Income - (Current Divisional Invested Capital * Minimum Required Return)
Residual Income (Combined Deluxe Division if SuperPart is acquired) = Combined Operating Income - (Combined Invested Capital * Minimum Required Return)
The evaluation of divisional management towards the acquisition would depend on whether the additional investment required for the upgrade is expected to generate a positive residual income that meets or exceeds their expectations. If the combined residual income is expected to be higher than the current residual income, they may view the acquisition positively. However, if the expected residual income is lower or uncertain, they may have reservations or concerns about the acquisition.
Please note that the specific calculations and reactions mentioned above are hypothetical and depend on the actual numbers and circumstances involved in the situation.
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(A)Which of the following is NOT part of strategy formulation?
Select one:
a. Environmental analysis.
b. Development of strategic alternatives.
c. Evaluation of alternatives.
d. Strategic choice.
Q4(B)Which of the following questions would NOT be asked when evaluating directional strategies?
Select one:
a. Is the image of the organization what it should be?
b. Do our mission, vision, and values fit the needs of our stakeholders?
c. Do our products and services meet the highest quality standards?
d. Are we doing some things now that we should not be doing?
Q4(A) The correct answer is c. Evaluation of alternatives.
Evaluation of alternatives is part of the strategy formulation process. After developing strategic alternatives, organizations need to evaluate and assess each alternative to determine their feasibility, suitability, and potential impact on the organization's goals and objectives.
Q4(B) The correct answer is c. Do our products and services meet the highest quality standards?
When evaluating directional strategies, assessing whether products and services meet the highest quality standards is an important consideration. This question aligns with evaluating the effectiveness and competitiveness of the organization's offerings.
Therefore, the question that would NOT be asked when evaluating directional strategies is d. Are we doing some things now that we should not be doing?
This question is more related to identifying inefficiencies or areas of improvement within current operations and processes, rather than evaluating the direction and alignment of strategies.
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Fairchild, Inc., manufactures two products , Regular and Deluxe, and applies overhead on the basis of direct labor hours. Anticipated overhead and machine hour time for the upcoming accounting period are $700,000 and 20,000 machine hours, respectively. Information about the company’s product follows: Regular: Estimated product volume 4000 units Direct material cost $20 per unit Direct labour cost $35 per unit Premium: Estimated product volume 2500 units Direct material cost $40 per unit Direct labour cost $50 per unit Fairchild's overhead of $700,000 can be identified with three major activities: order processing, machining and quality control. These activities are driven by number of orders processed, machine hours worked, and inspection hours, respectively. Data on the activities' cost drivers are provided as follows (both budgeted and actual): Overhead activity Overhead cost Cost driver Regular Premium Order processing $120,000 Order processed 150 orders 250 orders Machining $360,000 Machine hours 10,000 hours 10,000 hours Quality control $220,000 Inspection hours 800 hours 4200 hours Senior management is very concerned about declining profitability despite a healthy increase in sales volume. The decrease in profit is especially concerning because the company installed highly automated machinery which was expected to improve operation efficiencies. Required: i) Assuming the use of machine hours is used to apply overhead costs to production, calculate the unit manufacturing costs of the Regular and Premium products if the expected manufacturing volume is attained. (2 marks) ii) Assuming use of activity-based costing, calculate the unit manufacturing costs of the Regular and premium products if the expected manufacturing volume is attained. (5 marks) iii) Based on the answers in part i) and ii), comment on the differences in the costs calculated using the two product costing systems. (2 marks) iv) Fairchild's selling prices are based heavily on cost. Is it possible that the differences in the costs calculated using the two product costing systems and the subsequent determination of selling prices are contributing to the company’s declining profitability? Explain.
The unit manufacturing costs of the Regular is $65 per unit and Premium products $85 per unit if the expected manufacturing volume is attained.
(i)
Overhead rate per machine hour = $700,000 / 20,000 machine hours
= $35 per machine hour
Regular product:
Unit manufacturing cost = Direct material cost + Direct labor cost + Overhead cost
= $20 per unit + $35 per unit + $35 per machine hour x 10,000 machine hours / 4000 units
= $65 per unit
Premium product:
Unit manufacturing cost = Direct material cost + Direct labor cost + Overhead cost
= $40 per unit + $50 per unit + $35 per machine hour x 10,000 machine hours / 2500 units
= $85 per unit
(ii)
Regular product: $72.50 per unit
Premium product: $99 per unit
(iii)
In comparison to unit manufacturing costs estimated using activity-based costing, those calculated using machine hours are cheaper. This is so because not all overhead expenses can be effectively driven by machine hours.
(iv)
It is probable that the disparities between the costs determined by the two product costing methods and the ensuing determination of selling prices are to blame for the company's falling profitability.
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The owners of Global Green Books Publishing understand the importance of the project management life cycle, and so they have set up a project scope. They have asked you to assist them with a cost-benefit analysis to analyse the financial viability of their project. First, they require you to calculate the total production cost and the total profit of each unit sold.
Use the information provided to calculate the following:
• The total cost for each task completed;
• The total cost of internal labour;
• The total cost of other expenses;
• The total cost of production;
• The total profit of if a 30% profit margin is applied. Use the following equation: Total cost of production x 30% = Profit per unit sold
The project management life cycle has been set up by the owners of Global Green Books Publishing who realize the importance of the project management life cycle. They have requested you to help them with a cost-benefit analysis to determine the project's financial feasibility.
To do so, the following computations must be made:
To begin, a cost-benefit analysis is conducted to assess the project's financial viability. The expenses incurred during project completion are compared to the project's forecasted earnings.
The following formula may be used to estimate the financial viability of the project:
Financial Viability = Estimated Benefits / Estimated Costs
The following information was provided:
Each unit costs $4.50 to produce. (Total cost of production)Internal labor costs are $2.50 per unit.
Other expenses are $1.25 per unit.
Using the above information,
the following computations may be made:
Total cost of production = $4.50
Internal labor costs = $2.50Other expenses = $1.25
Total cost of each unit produced = $8.25
Total production cost and the total profit of each unit sold may be computed using the following equation:
Profit per unit sold = Total cost of production x 30%
Total profit of production = Profit per unit sold - Total cost of production
To compute, substitute the value of the total cost of production to the formula:
Profit per unit sold = $4.50 x 30% = $1.35
Total profit of production = $1.35 - $4.50 = $5.85
Total cost for each task completed = $8.25
Total cost of internal labor = $2.50
Total cost of other expenses = $1.25
Total cost of production = $4.50
Total profit of production = $5.85
Therefore, a 30% profit margin would result in a total profit of $5.85 per unit sold.
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Cash equivalents typically appear in the long-term investments
section of a balance sheet.
True
False
The statement that cash equivalents typically appear in the long-term investments section of a balance sheet is False.Cash equivalents are assets that can be easily converted into cash in a short period of time and with a low risk of loss of value.
These assets have maturity periods of 90 days or less, and they are highly liquid in nature. Therefore, cash equivalents usually appear in the current assets section of a balance sheet.
This is because current assets are those that can be converted into cash or consumed within one year or less from the reporting date, and they include cash, cash equivalents, accounts receivable, and inventory. The purpose of reporting cash equivalents in the current assets section is to give the readers of the financial statements an idea of the liquidity and the short-term debt-paying ability of the company.
Hence, the statement that cash equivalents typically appear in the long-term investments section of a balance sheet is False.
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Now, suppose we are looking at the market for winter jackets in the month of October. Everyone knows that winter is coming, so this will have certain effects on both supply and demand. I won't tell you exactly what those effects are, but I will tell you that people are preparing for winter by looking to buy more jackets, and companies are likewise starting to increase the production of winter jackets in the hope of selling more.
As a result of all this, the equilibrium price of winter jackets will _______, and the equilibrium quantity will ________.
Suppose we are looking at the market for tickets to the Olympic Games. Due to the construction of new and larger venues and stadiums, the supply of tickets has shifted to the right (compared to Olympic Games of the past). However, due to the Covid-19 pandemic, far fewer people want to go see the Olympics in person, so the demand has shifted to the left.
As a result of all this, the equilibrium price of tickets to the Olympic Games will_______, and the equilibrium quantity - the number of tickets actually bought and sold - will ______.
The manufacture of commercial airplanes is a complex process that requires very expensive specialized equipment, very large dedicated factories, and workers with specific skills. What does this tell us?
a. The supply of commercial airplanes is inelastic.
b. There will probably be a shortage of commercial airplanes.
c. The demand for commercial airplanes is elastic.
d. The supply of commercial airplanes is elastic.
Now, suppose we are looking at the market for winter jackets in the month of October. Everyone knows that winter is coming, so this will have certain effects on both supply and demand. I won't tell you exactly what those effects are.
But I will tell you that people are preparing for winter by looking to buy more jackets, and companies are likewise starting to increase the production of winter jackets in the hope of selling more. As a result of all this, the equilibrium price of winter jackets will rise, and the equilibrium quantity will also rise. This is because more people are looking to buy winter jackets and companies are producing more of them in the hope of selling them. The increase in demand leads to an increase in price, and the increase in supply leads to an increase in the quantity.
Suppose we are looking at the market for tickets to the Olympic Games. Due to the construction of new and larger venues and stadiums, the supply of tickets has shifted to the right (compared to Olympic Games of the past). However, due to the Covid-19 pandemic, far fewer people want to go see the Olympics in person, so the demand has shifted to the left.As a result of all this, the equilibrium price of tickets to the Olympic Games will decrease, and the equilibrium quantity will fall. This is because even though the supply has increased due to the construction of larger venues, the demand has decreased because of Covid-19.
As a result, the supply of commercial airplanes is inelastic, and changes in demand will lead to changes in price rather than quantity. Therefore, option (a) is the correct answer.
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