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**The correct answer is A. **

The graph attached represents the supply and demand curves for Swiss francs. The amount of francs supplied and demanded is represented in the X axis while the price of francs (expressed in US dollars) is represented in the Y axis.

After the supply curve shifts right, it will intersect the demand curve, which stays the same, in a point on the right and below the initial intersection point. __ Therefore the quantity of francs exchanged in the new equilibrum will increase while the price charged for francs will decrease__.

Question

2. Calculating the price elasticity of demand: A step-by-stepguide Suppose that during the past year, the price of a laptop computer fell from $2,650 to $2,430. During the same time period, consumer sales increased from 495,000 to 664,000 laptops.

Solution 1

**The correct answer is: "price elasticity of demand = 4.11"**

**The demand function** represents the quantity of a certain good or service that consumers are willing to purchase in the market at different price levels. **The law of demand** states that there is an inverse relationship between price and quantity demanded (ceteris paribus, hence, given that the rest remains equal). Therefore, when the price charged decreases, the amount that consumers are willing to purchase increases.

In turn,** the elasticity of the demand function** measures the sensitiveness of the quantity demanded by consumers when there is a certain price change. *It is computed by dividing the percentage change of the price variation by the percentage change in the amount demanded and comparing the two figures like in the chart attached. The formula is attached in a second picture, afterwards the absolute value is applied to the result obtined from the formula. *

Price elasticity of demand= **I** [(664000-495000)/495000)] / [(2,430-2,650)/2,650] **I**= 4.11

*(the absolute value has been already applied in the formula*** I I*** )*

**This demand is elastic because the figure obtained exceeds 1. It means that the size of the amount demanded is larger than the size of the price variation, both measured in percentage. **

Question

A company that has a marketing strategy driven by a social marketing concept would most likely promote its _____ in its marketing messages.

a frequent sales

b superiority over the competition

c sustainability efforts

d role as a trendsetter

a frequent sales

b superiority over the competition

c sustainability efforts

d role as a trendsetter

Solution 1

D- role as a trendsetter. Social media is all about influencing people. Company’s are effective when they can set themselves apart from the competition

Solution 2

**Answer:*** A company that has a marketing strategy driven by a social marketing concept would most likely promote its **sustainability efforts** in its marketing messages.*

**Explanation:**

C. **sustainability efforts**

Question

Net interest margin—often referred to as spread—is the difference between the rate banks pay on deposits and the rate they charge for loans. Suppose that the net interest margins for all U.S. banks are normally distributed with a mean of 4.15 percent and a standard deviation of .5 percent. (a) Find the probability that a randomly selected U.S. bank will have a net interest margin that exceeds 5.40 percent. (Round answer to 4 decimal places.) P (b) Find the probability that a randomly selected U.S. bank will have a net interest margin less than 4.40 percent. (Round answer to 4 decimal places.) P (c) A bank wants its net interest margin to be less than the net interest margins of 95 percent of all U.S. banks. Where should the bank’s net interest margin be set? (Round the z value to 3 decimal places. Round answer to 4 decimal places.)

Solution 1

Answer:

(a) [tex]P(X\:>\:5.40)=0.9938[/tex]

(b) [tex]P(X\:<\:4.40)=0.0062[/tex]

(c) X=4.975 percent

Explanation:

(a) Find the z-value that corresponds to 5.40 percent

.[tex]Z=\frac{X-\mu}{\sigma}[/tex]

[tex]Z=\frac{5.40-4.15}{0.5}[/tex]

[tex]Z=\frac{1.25}{0.5}=2.5[/tex]

Hence the net interest margin of 5.40 percent is 2.5 standard deviation above the mean.

The area to the left of 2.5 from the standard normal distribution table is 0.9938.The probability that a randomly selected U.S. bank will have a net interest margin that exceeds 5.40 percent is 1-0.9938=0.0062

(b) The z-value that corresponds to 4.40 percent is [tex]Z=\frac{4.40-4.15}{0.5}=0.5[/tex]The net interest margin of 4.40 percent is 0.5 standard deviation above the mean.

Using the normal distribution table, the area under the curve to the left of 0.5 is 0.6915

Therefore the probability that a randomly selected U.S. bank will have a net interest margin less than 4.40 percent is 0.6915

(c) The z-value that corresponds to 95% which is 1.65

We substitute the 1.65 into the formula and solve for X.[tex]1.65=\frac{X-4.15}{0.5}[/tex]

[tex]1.65\times 0.5=X-4.15[/tex][tex]0.825=X-4.15[/tex]

[tex]0.825+4.15=X[/tex]

[tex]4.975=X[/tex]

A bank that wants its net interest margin to be less than the net interest margins of 95 percent of all U.S. banks should set its net interest margin to 4.975 percent.

Question

Victory Tire Company makes a special kind of racing tire. Variable costs are $ 220 per unit, and fixed costs are $ 20 comma 000 per month. Victory sells 500 units per month at a sales price of $ 310. If the quality of the tire is upgraded, the company believes it can increase the sales price to $ 360. If so, the variable cost will increase to $ 230 per unit, and the fixed costs will remain the same. If Victory decides to upgrade, how will it affect operating income

Solution 1

**Answer:**

** If Victory decides to upgrade, the operating income increase by $20,000**

**Explanation:**

For calculating the affect of operating income between two unit levels, the computation of operating income is important.

Steps given for calculating the operating income is given below:

Step 1 : First we have to compute contribution to arrive net operating income .

So, contribution = Sales revenue - variable cost.

Step 2 : Now, the computation of operating income is easy.

Because the operating income is an amount which is come from subtracting fixed cost from contribution.

So, Operating income = Contribution margin - Fixed cost

The computation of both levels is given in the attachment sheet.

**Thus, If Victory decides to upgrade, the operating income increase by $20,000**

Question

Warner Company purchases $50,000 of raw materials on account, and it incurs $60,000 of factory labor costs. Supporting records show that (a) the Assembly Department used $24,000 of raw materials and $35,000 of the factory labor, and (b) the Finishing Department used the remainder. Journalize the assignment of the costs to the processing departments on March 31.

Solution 1

**Answer:**

WIP Assembly DEBIT 24,000

WIP Finishing DEBIT 26,000

Raw materials Inventory CREDIT 50,000

WIP Assembly DEBIT 35,000

WIP Finishing DEBIT 25,000

Wages Payable CREDIT 60,000

**Explanation:**

**Our first goal is to calculate the diference to get the finishing values**

50,000 raw materials

assembly 24,000

50,000 - 24,000 = 26,000

Finishing 26,000

60,000 labor cost

Assembly 35,000

60,000 - 35,000 = 25,000

Finishing 25,000

**Now we proceed to do the entries:**

WIP Assembly DEBIT 24,000

WIP Finishing DEBIT 26,000

Raw materials Inventory CREDIT 50,000

WIP Assembly DEBIT 35,000

WIP Finishing DEBIT 25,000

Wages Payable CREDIT 60,000

__ Important:__ There is no information about a finished goods or transfer from one process to another, so we should assume both are still in progress and no transfer to either one or finished goods were made.

So the values are transfer to the WIP of each department.

Solution 2

The **Journal entries** of the assignment of the **costs **to the **processing departments **on March 31 are given in the **image **below.

**Journal Entries **are the systematic **record **of an accounting **transaction**. It is the legal **instrument **of compliance or **making records **of any transactions, either **economic **or non-economic.

Transactions are **numbered **in an accounting** journal** that **exhibits **a company's **debit **and credit **balances**. The** journal entry **can **belong **of various **recordings**, each of which is either a **debit **or a credit.

According to the given transactions, Our first **goal **is to **compute **the **difference **to develop the **finishing **values.

**Raw **materials = $50,000

**Assembly **= 24,000

[tex]\text{Finishing} = \text{Raw Materials} - \text{Assembly}\\\text{Finishing} =\$50,000-\$24,000\\\text{Finishing} =\$ 26,000[/tex]

**labor **cost =$60,000

**Assembly **= 35,000

[tex]\text{Finishing} = \text{Labor Cost} - \text{Assembly}\\\text{Finishing} =\$60,000-\$35,000\\\text{Finishing} =\$ 25,000[/tex]

**Note:**

There is no **content **about** finished goods**, so we **presume **both are still in **progression **and no **movement **to either one or **finished **goods were **reasoned**.

Therefore, the** journal entries** are given in the **image **below.

Learn more about the** journal entries**, refer to:

https://brainly.com/question/17439126

Question

Lisah, Inc., manufactures golf clubs in three models. For the year, the Big Bart line has a net loss of $10,000 from sales $200,000, variable costs $180,000, and fixed costs $30,000. If the Big Bart line is eliminated, $20,000 of fixed costs will remain. Prepare an analysis showing whether the Big Bart line should be eliminated.

Solution 1

**Answer:**

It should be continued.

**Explanation:**

[tex]\left[\begin{array}{ccc}-&continued&discontinued&Sales&200,000&0&Variable Costing&-180,000&0&Contribution&20,000&0&Fixed Cost&-30,000&-20,000&Net Loss&-10,000&-20,000\end{array}\right][/tex]

It is better to continue with the Big Bart Line, because the net loss would increase by 10,000 if eliminated

Solution 2

**Answer:**

Please see attachment

**Explanation:**

Please see attachment

Question

Warner Company’s year-end unadjusted trial balance shows accounts receivable of $99,000, allowance for doubtful accounts of $600 (credit), and sales of $280,000. Uncollectibles are estimated to be 1.5% of accounts receivable. 1. Prepare the December 31 year-end adjusting entry for uncollectibles.

Solution 1

**Answer:**

bad debt expense 885 debit

allowance for doubtful accounts 885 credit

**Explanation:**

expected uncollectibles

1.5% of AR = 99,000 x 1.5% = 1,485

current balance credit (600)

Adjustment 885

**When calculating over account receivable, we stimated the allowance so we have to adjsut for the diference.**

Solution 2

The** year-end** adjusting **entry** for **uncollectibles **is given in the **image **below.

**Journal entry **is the systematic **record **of all the **financial transactions**, that shows all the **transactions **of the business incurred in a **particular **period of **time**.

It is the **primary recording **of all the **transactions **related to the **money **only.

__Computation of amount of expected __**uncollectibles:**

According to the given information,

The amount of expected **uncollectibles **are:

[tex]1.5\% \text{of} \text{Accounts Receivable}- \text{Currect Balance Credit}[/tex]

[tex]= 1.5\% \times \$99,000- 600\\=\$885[/tex]

Therefore, the amount of expected **uncollectibles **are **885**.

Refer, the **image **given **below **for the **adjustment entry **of the expected **uncollectibles**.

To learn more about the** journal entry**, refer to:

https://brainly.com/question/17439126

Question

Hemisphere Corp. is considering a Build-Operator-Transfer (BOT) contract to construct and operate a large dam with a hydroelectric power generation facility in a developing nation in the southern hemisphere. The initial cost of the dam is expected to be $30 million, and it is expected to cost $100,000 per year to operate and maintain. Benefits from flood control, agricultural development, tourism, etc., are expected to be $2.8 million per year. At an interest rate of 8% per year, should the dam be constructed on the basis of its conventional B/C ratio? The dam is assumed to be a permanent asset for the country.

Solution 1

**Answer:**

The dam should be constructed. The investment discounted payback is 25 years.

**Explanation:**

We have to make a cash flow for this case with the given data. See the document attached.

We consider an Initial cost of 30 millions in period 0, then we have every periods benefit of 2.800.000 and 100000 direct cost.

With those, is obtained **net cash flow **for each year (period), if we consider the given rate of interest, can be calculated the **discounted cash flow**

To know when this project covers all the investment, we have to consider the **cumulative **discounted cash flow. We have to see in the cash flow chart when the **cumulative discounted cash flow ** break the 0 (became higher than 0).

In this case , that will be at period 25. So we have to wait 25 years to recover the initial cost. Considering that the dam usually has a lifetime higher than that time, the project at this scenario, should be done.

Solution 2

**The conventional B/C ratio for the given dam is more than 1 if the company's rate of return is 8% per year. The conventional B/C ratio is 1.12. Hence, the dam should be constructed.
**

**
**

**Further explanation:
**

**
Conventional Benefit-Cost Ratio: **The Benefit-Cost ratio refers to the ratio, which represents the relationship between the benefits arising out of the project and the cost incurred on the project. This ratio is used for making a financial analysis of various projects. It is helpful in the evaluation of both public and private projects. The project can be chosen when its benefits are exceeding its cost. Conventional B/C ratio is computed by dividing the net benefits arriving out of the project with the net cost of the project. The net value of benefits is computed by subtracting the value of losses from the benefits. The net cost includes the initial and operating cost after subtracting the salvage value.

**Compute the conventional B/C ratio:
**

[tex]\text{Conventional B/C ratio}=\dfrac{\text{Present value of benefits}}{\text{Initial cost + Present value of operating and maintenance cost}}\\=\dfrac{\$35,000,000}{\$30,000,000+\$1,250,000}\\=\dfrac{\$35,000,000}{\$31,250,000}\\=1.12[/tex]

__Therefore, the conventional B/C ratio for the given dam is more than 1 if the company's rate of return is 8% per year. The conventional B/C ratio is 1.12. Hence, the dam should be constructed.
__

**
**

**Working note 1:
**

**
Compute the present value of benefits:
**

[tex]\text{Present value of benefits}=\dfrac{\text{Annual benefits}}{\text{Interest rate}}\\=\dfrac{\$2,800,000}{0.08}\\=\$35,000,000[/tex]

Hence, the present value of the benefits from dam is $35,000,000.

**
**

**Working note 2:
**

**
Compute the present value of operating and maintenance cost:
**

[tex]\text{Present value of operating and maintenance cost}=\dfrac{\text{Annual operating cost}}{\text{Interest rate}}\\=\dfrac{\$1,000,000}{0.08}\\=\$1,250,000[/tex]

Hence, the present value of the annual operating cost of dam is $1,250,000.

**
**

**Learn more
**

1. Average cost and average revenue

https://brainly.com/question/12987402

2. Direct materials efficiency variance

https://brainly.com/question/12987884

3. Cost of materials

https://brainly.com/question/4783765

**
**

**Answer details **

**
Grade: **Senior School

**
Subject: **Financial Accounting

**
Chapter: **Time value of money

**
**

**Keywords: **Hemisphere Corp., Build-operator-transfer (BOT), contract to construct, hydroelectricity power generation station, developing nation, $30 million, expected to cost, benefits from flood control, agricultural development, tourism, dam be constructed, conventional B/C ratio, dam is assumed to be constructed, permanent asset, for the country, southern hemisphere, large dam, time value of money, present value of money, contract to construct, developing nation, cost ratio, expected to be $2.8 million, operate and maintain.

Question

Suppose two firms, A and B, are simultaneously considering entry into a new market. If neither enters,both earn zero. If both enter, they both lose 100. If one firm enters, it gains 50 while the other earns zero. Set up the payoff matrix for this game and determine if any Nash equilibria exist. Can you predict the outcome? What if firm A gets to decide first?

Solution 1

**Answer: The answer is as follows:**

**Explanation:**

The payoff matrix for this game is shown in the image.

The nash equilibrium in this game exist when both the firms do not enter into a new market. The nash equilibrium outcome is (0,0), at this choice both the firms didn't loose anything.

If firm A gets to decide first then it would choose not to enter into the new market, this will gives (0,50) & (0,0) outcome and if it chooses to enter then this will gives (-100,-100) & (50,0).

Question

Simkins Renovations Inc. is considering a project that has the following cash flow data. What is the project's IRR? Note that a project's IRR can be less than the WACC (and even negative), in which case it will be rejected. Year 0 1 2 3 4 Cash flows -$850 $300 $290 $280 $270

Choices: 17.48% 19.22% 14.44% 15.89% 13.13%

Choices: 17.48% 19.22% 14.44% 15.89% 13.13%

Solution 1

**Answer:**

**The project's IRR is 13.13% **

**Explanation:**

The Internal Rate of Return is that return in which Net Present Value is zero .

The Net Present Value (NPV) is the value which show the difference between the initial investment and all years of cash flows of two projects. The cash flows should be discounted by applying discounted factor.

There are two scenarios for accepting or rejecting the project . If NPV is positive, than the project should be accepted otherwise not.

The Internal Rate of Return is calculated by using excel formula :

= IRR ( - year0 cash flows, all years cash flows).

The computation is shown in the attachment sheet.

**Thus, the project's IRR is 13.13% **

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