Answers
Answer: $450,225
Explanation:
Product costs = Direct materials + Direct labor + Variable manufacturing overhead + Fixed manufacturing overhead
= (21,750 * 7.80) + (21,750 * 4.80) + (21,750 * 2.30) + (21,750 * 5.80)
= 169,650 + 104,400 + 50,025 + 126,150
= $450,225
Related Questions
Two-Asset Portfolio Stock A has an expected return of 12% and a standard deviation of 35%. Stock B has an expected return of 17% and a standard deviation of 60%. The correlation coefficient between Stocks A and B is 0.2. What is the expected return of a portfolio invested 20% in Stock A and 80% in Stock B
Answers
Answer: 16%
Explanation:
Expected return of a portfolio is the weighted average of the returns of the individual stocks given the proportion of the portfolio invested in them:
= (Return on stock A * Percentage invested in stock A) + ( Return on Stock B * Percentage invested in Stock B)
= (12% * 20%) + (17% * 80%)
= 2.4% + 13.6%
= 16%
What is currency in economics
Answers
Answer:
Currency, in industrialized nations, portion of the national money supply, consisting of bank notes and government-issued paper money and coins, that does not require endorsement in serving as a medium of exchange; among less developed societies, currency encompasses a wide diversity of items (e.g., livestock, stone carvings, tobacco) used as exchange media as well as signs of value or wealth. In the developed nations, where checks drawn on demand deposits are an important means of transaction, currency may actually account for only a small portion of the total money supply
Explanation:
Since the abandonment of the gold standard in the 1930s, governments have not been obligated to repay the holders of currency in any form of precious metal. Consequently the volume of currency is determined by the actions of the government or central bank and not by the supply of precious metals.
Kingbird, Inc.had the following transactions during 2022: 1. Issued $340000 of par value common stock for cash. 2. Recorded and paid wages expense of $163200. 3. Acquired land by issuing common stock of par value $136000. 4. Declared and paid a cash dividend of $27200. 5. Sold a long-term investment (cost $8160) for cash of $8160. 6. Recorded cash sales of $1088000. 7. Bought inventory for cash of $435200. 8. Acquired an investment in Zynga stock for cash of $57120. 9. Converted bonds payable to common stock in the amount of $1360000. 10. Repaid a 6-year note payable in the amount of $598400. What is the net cash provided by investing activities
Answers
Answer: -$48,960
Explanation:
Investing activities are those that have to do with Capital expenses. These include fixed assets and investments into the securities of other companies.
From the transactions listed, the following are investing activities:
5. Sold a long-term investment (cost $8160) for cash of $8,160.
8. Acquired an investment in Zynga stock for cash of $57,120.
Net cash from investing activities is therefore:
= Cash inflows - Cash outflows
= 8,160 - 57,120
= -$48,960
Revenue from a contract with a customer cannot be recognized until a contract exists. is recognized even if the contract is still wholly unperformed. can be recognized even when a contract is still pending. is recognized when the customer receives the rights to receive consideration
Answers
Answer:
cannot occur until a contract exists.
Explanation:
Revenue according to GAAP Definition is simply said to be increase or decrease of asset and/or combination of both by production or goods delivery, or offering services that are all about a major running operations. Revenue Recognition also according to GAAP is the Revenue is known(recognize) when it has been realized and earned.
SEC Criteria to Recognize Revenue are the evidence of an arrangement exists, Goods Delivered or Services Rendered and others.
Revenue from a contract with a customer cannot be recognized until a contract exists which form the beginning of the contract.
Aunt Mabel promised to give you $9000 when you successfully complete your freshman year, $6000 when you successfully complete your sophomore year, $1000 when you successfully complete your junior year, and $8000 when you successfully complete your senior year. Aunt Mabel made this promise when you graduated from High School and let's assume you go directly to the University of Illinois and graduate in four years. Aunt Mabel expects the interest rates to be 5.250% during your freshman year, 2.500% during your sophomore year, 3.250% during your junior year, and 9.250% during your senior year. If Aunt Mable can predict interest rates accurately, she will deposit into her bank account $____________. (dollars, rounded to two places after the decimal)
Answers
Solution :
At every stage the formula used will be :
[tex]$\frac{\text{available balance}}{(1+\text{interest rate})}= \text{required bank balance}$[/tex]
After the junior year, Aunt Mabel's bank balance will be :
[tex]$=\frac{8000}{1.0925}$[/tex]
= $ 7,322.65
Aunt Mabel's bank balance after sophomore year will be :
7,322.65 + 1000 = $ 8,322.65
[tex]$=\frac{8,322.65}{1.0325} $[/tex]
= $ 8060.677
After the freshman year, bank balance of Aunt Mable's will be :
8060.677 + 6000 = $ 14,060.677
[tex]$=\frac{14,060.677}{1.0250} $[/tex]
= $ 14.0606
If Aunt Mabel can predict the interest rate with accuracy, she will have to deposit :
$ 14.0606 + $ 9000 = $ 9,014.06
[tex]$=\frac{9014.06}{1.0525}$[/tex]
= $ 8,565.241
The systems theory Multiple Choice emphasizes that an organization is one system in a series of subsystems. implements a piecerate system in which workers are paid additional wages when they exceed a standard level of output for each job. enforces a system that suggests that frontline supervisors should receive a bonus for each of their workers who completed their assigned daily tasks. develops a system to lower costs and increase worker productivity by showing how employees could work smarter, not harder. suggests that organizations are effective when they have the social system and the technical system to make products and services that are valued by customers.
Answers
Answer:
The systems theory:
emphasizes that an organization is one system in a series of subsystems.
Explanation:
A systems theory approach is a theoretical perspective that focuses on the interactions and relationships between parts of a whole. The theory helps to understand how an entity is organized, functions, and produces outcomes, which impact its growth. It also explains how rules and regulations are applied to govern an organization towards the achievement of its goals.
The systems theory is emphasizing that an organization is one system in a series of subsystems. Thus, option (a) is correct.
The systems theory of organization asserts that organizations are composed of many subsystems that are not necessarily related to one another but work together to form the whole.
The systems approach to management looks at a business as a series of systems and subsystems that interact with one another to create the overall organizational system.
In the systems approach to management, employees are more focused on achieving a collective goal for an organization rather than operational output.
Therefore, option (a) is correct
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Your question is incomplete, but most probably the full question was.
The systems theory:
Multiple Choice
A. Emphasizes that an organization is one system in a series of subsystems.
B. Implements a piece rate system in which workers are paid additional wages when they exceed a standard level of output for each job.
C. Enforces a system that suggests that frontline supervisors should receive a bonus for each of their workers who completed their assigned daily tasks.
D. Develops a system to lower costs and increase worker productivity by showing how employees could work smarter, not harder.
E. Suggests that organizations are effective when they have the social system and the technical system to make products and services that are valued by customers.
Seasons Construction is constructing an office building under contract for Cannon Company and uses the percentage-of-completion method. The contract calls for progress billings and payments of $1,550,000 each quarter. The total contract price is $18,600,000 and Seasons estimates total costs of $17,750,000. Seasons estimates that the building will take 3 years to complete, and commences construction on January 2, 2018.At December 31, 2018, Seasons estimates that it is 30% complete with the construction, based on costs incurred. What is the total amount of Revenue and Profit from Long-Term Contracts recognized for 2018?
Answers
Answer:
The correct answer is "$5,580,000".
Explanation:
The given values are:
Total contract price,
= $18,600,000
Completion percentage,
= 30%
Seasons estimates,
= $17,750,000
Now,
In 2018,
The total amount of revenue will be:
= [tex]Total \ contract \ price\times Completion \ percentage[/tex]
On substituting the given values, we get
= [tex]18,600,000\times 30 \ percent[/tex]
= [tex]5,580,000[/tex] ($)
Savings accounts are different from investments in that they
Is (typically have lower interest rates)
Answers
Answer:
True.
Explanation:
Savings accounts can be defined as as an account operated by a financial institution which offer its holders lower interest rates.
Savings accounts are different from investments in that they typically have lower interest rates.
Investments such as real estate properties, bonds, and stocks generally offer higher interest rates to the investors. Therefore, investors are usually more likely to invest their money in these investments rather than have their money remain in a savings account.
Experience indicates that strategic alliances Multiple Choice have a high "divorce rate." are generally successful. work well in cooperatively developing new technologies and new products but seldom work well in promoting greater supply chain efficiency. work best when they are aimed at achieving a mutually beneficial competitive advantage for the allies. are rarely useful in helping a company win the race for global industry leadership and establish positions in industries of the future.
Answers
Answer:
have a high "divorce rate."
Explanation:
A strategic alliance can as well reffered to as strategic partnership and can be regarded as agreement that exist between two parties or more so that they can work in acheiving some objectives they agreed on even though they still remains as an independent organization to each other. It should be noted that Experience indicates that strategic alliances have a high "divorce rate."
During 2019, Zigma Company earned service revenue amounting to $800,000, or which $645,000 was collected in cash; the balance will be collected in January 2020. Also in 2019, there were collections of cash prior to the delivery of goods/services totaling $11,100. What amount should the 2019 income statement report for service revenue
Answers
Answer:
$800,000
Explanation:
Given that;
Sales revenue = $800,000
Cash collected = $645,000
Remaining amount cash collected in January = $155,000
And the delivery of goods is $11,100
Here, since the service revenue earned is $800,000 and same amount would be reported under the income statement, other items given would be ignored.
It therefore means that the sum of $800,000 should be the 2019 income statement report for service revenue.
What does greater capital mobility mean? A. Governments impose restricted trade policies. B. Investment money flows freely around the world. C. Foreign investment is tightly controlled. D. Companies can only profit by investing, not producing.
Answers
Answer:
B. Investment money flows freely around the world
Explanation:
Capital mobility refers to the movement of investment funds from one country to another. Greater capital mobility implies free movement of capital across borders.
Greater capital mobility is only possible where there are no restrictions on capital movements. Restrictions of capital mobility include taxes, transaction costs, and government regulations.
Answer:
b
Explanation:
4. Tom Busby owes $20,000 now. A lender will carry the debt for four more years at 8 percent interest. That is, in this particular case, the amount owed will go up by 8 percent per year for four years. The lender then will require Busby to pay off the loan over 12 years at 11 percent interest. What will his annual payment be
Answers
Answer:
Tom Busby
His annual payment will be:
= $4,091.64
Explanation:
a) Data:
Loan = $20,000
Interest on loan for 4 years = 8% per annum
Amount of loan after 4 years = $27,200 ($20,000 * 1.360)
Payment period = 12 years
Interest rate during payment period = 11%
b) From online finance calculator:
You will need to pay $4,091 every year for 12 years to payoff the debt at 11% interest.
Monthly Payment $340.97
Annual Payment $4,091.64
Time Required to Clear Debt 12.00 years
Total of 144 or 12 Payments = $49,099.25
Total Interest $21,899.25
6. Microeconomics and macroeconomics Determine whether each of the following topics would more likely be studied in microeconomics or macroeconomics. Microeconomics Macroeconomics The effect of an increase in the money supply on the rate of inflation The effect of government regulation on a monopolist's production decisions The effect of federal government spending on the national unemployment rate
Answers
Answer:
Microeconomics has to do with individual households and firms and the decisions they make in an economic setting.
Macroeconomics on the other hand deals with the economy as a whole which means that figures are more aggregated here.
The effect of an increase in the money supply on the rate of inflation. MACROECONOMICS.
This has to do with how the entire economy will be affected as a result of a change in money supply so is Macroeconomics.
The effect of government regulation on a monopolist's production decisions. MICROECONOMICS.
This relates to how government regulation will affect an individual monopolist so is Microeconomics.
The effect of federal government spending on the national unemployment rate. MACROECONOMICS.
This has to do with the national unemployment rate which is an aggregated figure to represent unemployment as a whole in the economy so this is most definitely Macroeconomics.
Tiger Inc. has total sales of $35,821, cost of goods sold is $10,832, general and administrative expenses are $8,240, and depreciation is $523. The tax rate is 21 percent. The firm does not have any interest expense. What is the operating cash flow
Answers
Answer:
the operating cash flow is $13,342
Explanation:
The computation of the operating cash flow is shown below:
Operating cash flow = (sales - Cost of goods sold - G&A expenses - depreciation expense) × (1 - tax rate) + Depreciation expense
= ($35,821 - $10,832 - $8,240 - $523) × (1 - 0.21) + $523
= $13,342
Hence, the operating cash flow is $13,342
HELP PLSSS HALP
How many tears would it take to fill up a pool? Explain.
Answers
Answer: Lets say 2 tear drops equals a teaspoon, And 3 teaspoons equals a tablespoon and 2 tablespoons equals a fluid ounce and 32 ounces equal a quart and 4 quarts equal a gallon and lets say the pool is 10 gallons It would take about 768000 tears to fill a ten gallon pool. Not gonna lie not even i'm depression enough for that.
You've collected the following information about a company: Assets Liabilities and Equity Cash 13,000 Accounts payable 16,000 Marketable securities 2,000 Notes payable 6,000 Accounts receivable 4,000 Current liabilities Inventory 32,000 Long-term debt 95,000 Current assets Total liabilities Machines 34,000 Paid-in capital 20,000 Real estate 80,000 Retained earnings Fixed assets Equity Total assets Total liab. & equity Attempt 1/10 for 10 pts. Part 1 What are total assets? 165000 Correct ✓ Total assets are the sum of current and fixed assets. Assets Liabilities and Equity Cash 13,000 Accounts payable 16,000 Marketable securities 2,000 Notes payable 6,000 Accounts receivable 4,000 Current liabilities Inventory 32,000 Long-term debt 95,000 Current assets 51,000 Total liabilities Machines 34,000 Paid-in capital 20,000 Real estate 80,000 Retained earnings Fixed assets 114,000 Equity Total assets 165,000 Total liab. & equity Total assets = Current assets + Fixed assets = 51,000 + 114,000 = 165,000
Answers
Answer:
The answer is "$228,000"
Explanation:
Formula:
[tex]\text{Total Assets = Current Assets + Fixed Assets}[/tex]
[tex]= [\$ 13,000 + \$ 2,000 + \$ 4,000 + \$ 95,000] + [\$ 34,000 + \$ 80,000]\\\\= [\$ 114,000] + [\$ 114,000]\\\\= \$ 228,000[/tex]
4-8 A manufacturing firm spends $350,000 annually for a required safety inspection program. A new monitoring technology would eliminate the need for such inspection. If the interest rate is 8% per year, how much can the firm afford to spend on this new technology
Answers
Answer:
$3,436,351.59
Explanation:
The computation of the amount that could be afforded to spend is shown below:
= Amount × (P/A, 8%, 20 years)
= $350,000 × 9.8181
= $3,436,351.59
We simply applied the above formula so that the correct value could come
And, the same is relevant too
Virginia owns 100% of Goshawk Company. In the current year, Goshawk Company sells a capital asset (held for three years) at a loss of $40,000. In addition, Goshawk has a short-term capital gain of $18,000 and net operating income of $90,000 during the year. Virginia has no recognized capital gain (or loss) before considering her ownership in Goshawk. How much of the capital loss may be deducted for the year, and how much is carried back or forward if Goshawk is (a) a proprietorship and (b) a C corporation
Answers
Answer:
a. IF Goshawk Company is a sole proprietorship, it will deduct a total of $21,000 ($18,000 offset against the capital gain and $3,000 deducted from net operating income) of the $40,000 capital loss and carry forward the remaining $19,000 to subsequent years.
b. IF Goshawk Company is a C corporation, it will carry back and forward the remaining $22,000 to be deducted from its net operating income for previous or future years, after offsetting $18,000 from the $18,000 short-term capital gain.
Explanation:
a) Data and Calculations:
Long-term capital loss = $40,000
Short-term capital gain = $18,000
Capital loss remaining = $22,000 ($40,000 - $18,000)
Net operating income = $90,000
Having which trait will enable you to deal with people in a way that does not offend them?
Answers
Answer:
Interpersonal skills..
Flax Corp. uses the direct method to prepare its Statement of Cash Flows. Flax's trial balances at December 31, 20X4 and 20X3, are as follows: December 31 20X4 20X3 Debits: 33,000 30,000 Cash $35,000 $32,000 Accounts receivable 33,000 30,000 Inventory 31,000 47,000 Property, plant, & equipment 100,000 95,000 Unamortized bond discount 4,500 5,000 Cost of goods sold 250,000 380,000 Selling expenses 141,500 172,000 General & administrative expenses 137,000 151,300 Interest expense 4,300 2,600 Income tax expense 20,400 61,200 $756,700 $976,100 Credits: Allowance for uncollectible accounts $1,300 $1,100 Accumulated depreciation 16,500 15,000 Trade accounts payable 25,000 17,500 Income taxes payable 21,000 27,100 Deferred income taxes 5,300 4,600 8% callable bonds payable 45,000 20,000 Common stock 50,000 40,000 Additional paid-in capital 9,100 7,500 Retained earnings 44,700 64,600 Sales 538,800 778,700 $756,700 $976,100 Flax purchased $5,000 in equipment during 20X4. Flax allocated one-third of its depreciation expense to selling expenses and the remainder to general and administrative expenses. What amounts should Flax report in its Statement of Cash Flows for the year ended December 31, 20X4, for cash paid for goods to be sold?
Answers
Answer:
the cash paid for goods to be sold is $226,500
Explanation:
The computation of the cash paid for goods to be sold is shown below:
= Cost of goods sold + Opening trade account payable - closing trade account payable + closing inventory - beginning inventory
= $250,000 + $17,500 - $25,000 + $31,000 - $47,000
= $226,500
Hence, the cash paid for goods to be sold is $226,500
How important are communication skills in project management? 2. Was Herb the right person to be assigned as the project manager? 3. There were communications issues with Alice, Bob, Betty, and Frank. For each communication issue, where was the breakdown in communications: encoding, decoding, feedback, and so on?
Answers
Answer:
1)
Communication plays a very important role in any of the project.
1.Good communication helps the project to complete in hassle free way.
2.If communication is clear, the project complete its deadline without any failure of delivering .
3.Proper communication also reduces the redundancy of data and ensures effective working of project.
If the present case study is considered, there is a communication gap between the team members because of which Herb faced a lot of problems.
If the communication is clear, then it surely helped Herb to do things better.
Hence communication skills are very important part in any project management.
2)
Yes, herb is the right person to be assigned as the project manager.
Because he has experience of 8 years due to which his company has believed in him. Herb is considered a subject matter expert and a Ph.D holder with knowledge of working in both R&D and manufacturing projects earlier. His experience and knowledge would definitely be an asset to the project, if the communication gets better. This will also help the company to enhance their business.
3)
Yes, there were communication issues with all the four team members.
In the case of Alice, there is a encoded message that she expects that Herb would be writing a recommendation mail for her promotion.
In case of Bob, there is a lack of feedback as Herb didn’t get the required follow up from the technicians.
In case of Betty, there is a problem in decoding Herb’s message of just determining the cost of procurement because of which Betty has actually procured the materials.
The case of Franck , there is feedback issue and that could been better in procuring the materials which did not actually happen.
Which of the following values should be inserted to correctly balance the ledger shown below?
Date Description Deposit Withdrawal Balance
8-13-18 Balance $120.74
8-14-18 Automatic Deposit – Paycheck $343.52
8-14-18 City payment – Water, Trash (Monthly) $53.90
8-14-18 Internet payment (Monthly) $86.40
$222.78
$323.96
$410.36
$464.26
Answers
$120.70 and add the paycheck $343.52
from there you would then minus the City payment of $53.90 and minus the internet payment of $86.40
This would leave you with $323.96
Hope This helps :)
Assume that in 2018, the first edition of a comic book was sold at auction for $762,400. The comic book was originally sold in 1938 for $.05. For this to have been true, what was the annual increase in the value of the comic book
Answers
Answer:
See below
Explanation:
The above is calculated using;
A = P(1 + r/100)^n
Where
A = Future value
P = Present value
r = rate of interest
n = time period
762,400 = 0.05(1 + r/100) ^ 80
(762,400/0.05)^(1/80) = 1 + r/100
What are the aims of standardization
Answers
Answer: The aims of standardization are as follows: to make a product, process or service fit for its purpose, controlling variety by using the optimum number of types or sizes, ensuring compatibility of various products, health, safety, protection of the environment, etc. The basic principle of standardization is consensus.
Explanation: there you go
Suppose that stockbrokers have projected that Jamestown Savings will pay a dividend of $2.50 per share on its common stock at the end of the year; a dividend of $3.25 per share is expected for the next year, and $4.00 per share in the following 2 years. The risk-adjusted cost of capital for banks in Jamestown's risk class is 15%. If an investor holding Jamestown's stock plans to hold that stock for only four years and hopes to sell it at a price of $50 per share, what should the value of the bank's stock be in today's market
Answers
Answer:
... Jamestown Savings will pay a dividend of $2.50 per share on its common.... ... per share on its common stock at the end of the year; a dividend of $3.25 per share is expected for the next year, and $4.00 per share in the following two years. The risk-adjusted cost of capital for banks in Jamestown's risk class is 15 percent.
Explanation:
In capital budgeting, the accounting rate of return (ARR) decision model: Incorporates the timing of cash flows. Considers the time value of money. Does not provide an unambiguous decision criterion (rule) regarding the acceptance of capital investment projects. Ignores accounting income generated after the break-even point. Ignores cash outflows after the initial investment.
Answers
Answer:
Incorporates the timing of cash flows.
Explanation:
The Accounting Rate of Return uses accrual accounting in order to determine net income instead of actual cash flows like the NPV, payback period or IRR.
ARR = average annual income / average investment.
For example, an increase in accounts receivable is not considered an increase in net cash flows, but it is considered part of total revenue which increases net income
A portion of FICA that is paid to provide eligible retired workers and
disabled Americans with medical insurance."
A.Social Security tax
B.State Income tax
C.Federal Income tax
D.Medicare
Answers
Answer:
D.Medicare
Explanation:
Medicare tax is imposed on employed workers to cater for medicare expenses for people aged 65 years and above. The medicare tax also caters to younger persons and people living with disabilities who qualify under specific criteria.
Medicare is financed by the Federal government through the taxes collected from employers and employees.
A merger of two firms may increase economic efficiency by A decreasing average total cost through an increase in economies of scale B decreasing output to reduce marginal cost and equalize price C increasing economic profits but decreasing consumer surplus D increasing consumer surplus by decreasing economic profits E increasing consumer surplus by shifting the demand curve for the product to the right
Answers
Answer:
A decreasing average total cost through an increase in economies of scale
Explanation:
In the case when two firms would be merged so this would rise in economic efficiency this would result in reduction in the average total cost via rise in the economies of scale
So according to the given situation, the option A is correct
And the remaining options are incorrect
The same would be relevant
A merger of two firms may increase economic efficiency by decreasing average total cost through an increase in economies of scale. Thus, option (a) is correct.
When a bigger company with more output can lower average costs, economies of scale happen. Prices for customers can be reduced thanks to decreased average costs.
A merger can help a business grow in size and benefit from a variety of reasons, including financial economies, organizational economies, technological economies, and economies of scale when purchasing goods.
A merger can result in increased earnings for the company by lowering expenses, which can then be put toward R&D expenditures, enhancing product quality, and commercial expansion.
As a result, the significance of the merger of two firms may increase economic efficiency are the aforementioned. Therefore, option (a) is correct.
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The current spot exchange rate is $1.55/€ and the three-month forward rate is $1.50/€. Based on your analysis of the exchange rate, you are confident that the spot exchange rate will be $1.52/€ in three months. Assume that you would like to buy or sell €1,000,000. What actions do you need to take to speculate in the forward market? Group of answer choices Sell euro today at the spot rate, buy them forward. Take a long position in a forward contract on €1,000,000 at $1.50/€. Buy euro today at the spot rate, sell them forward. Take a short position in a forward contract on €1,000,000 at $1.50/€.
Answers
Answer:
The answer is "Take a long position in a forward contract on €1,000,000 at $1.50/€".
Explanation:
In the long position cause the purchasing of the money, and it will be paying: [tex](1.5 \times 1,000,000) = \$ 1,500,000[/tex]
And you're also planning to sell and get on the markets: [tex](1.52 \times 1,000) = \$ 1,520,000.[/tex]
Therefore, you'll get: [tex]\$1,520,000 - \$1,500,000 = \$20,000.[/tex]
uppose the annual demand function for the Honda Accord is Qd = 430 – 10 PA + 10 PC – 10 PGwhere PA and PC are the prices of the Accord and the Toyota Camry respectively (in thousands), and PGis the price of gasoline (per gallon). What is the elasticity of demand of the Accord with respect to the price of Camry when both cars sell for $20,000 and fuel costs $3 per gallon? What is the elasticity with respect to the price of gasoline?
Answers
Answer:
Qd = 400 units
elasticity of demand of the Accord with respect to the price of Camry = 0.5
elasticity with respect to the price of gasoline = -0.075
Explanation:
Solution:
The annual demand function for the Honda Accord is:
Qd = 430 – 10 PA + 10 PC – 10 PG
Where,
PA = Price of Honda Accord
PC = Price of Honda Camry
PG = Price of Gasoline per gallon.
Selling Price of both cars = $20,000
Fuel Cost = $3 per gallon.
a) Elasticity of Demand of the Accord with respect to the price of Camry.
First, we need to calculate the number of units demanded.
Qd = 430 – 10 PA + 10 PC – 10 PG
Qd = 430 – 10 (20) + 10 (20) – 10 (3.00)
Qd = 430 - 200 + 200 - 30
Qd = 430 - 30
Qd = 400 units
Cross-price elasticity of the Accord with respect to the price of the Camry will be:
Cross Price = (dQd/dPC) x (PC)/(Qd)
dQd/dPC = 10
PC = 20
Qd = 400
So,
Cross Price = 10* 20/400
Cross Price = 0.5
b) Elasticity with respect to the price of gasoline?
Elasticity = (dQd/dPG)*(PG/Qd)
dQd/dPG = -10
PG = 20
Qd = 400
Elasticity = (-10)*(3/400)
Elasticity = -0.075
a) The Qd is = 400 units
b) When The elasticity of demand of the Accord regarding the price of Camry is = 0.5 then elasticity concerning the price of gasoline is = -0.075
Calculation Elasticity of demand
When The annual demand function for the Honda Accord is:
Then Qd = 430 – 10 PA + 10 PC – 10 PG
Where,
PA is = Price of Honda Accord
PC is = Price of Honda Camry
PG is = Expense of Gasoline per gallon.
Selling Price of both cars is = $20,000
Fuel Cost is = $3 per gallon.
a) When the Elasticity of Demand of the Accord about the price of Camry.
First, we need to estimate the number of units demanded.
Qd is = 430 – 10 PA + 10 PC – 10 PG
Qd is = 430 – 10 (20) + 10 (20) – 10 (3.00)
Qd is = 430 - 200 + 200 - 30
Qd is = 430 - 30
Qd is = 400 units
When the Cross-price elasticity of the Accord with respect to the price of the Camry will be:
Cross Price is = (dQd/dPC) x (PC)/(Qd)
dQd/dPC is = 10
PC is = 20
Qd is = 400
So,
Cross Price is = 10* 20/400
Cross Price is = 0.5
b) When is the Elasticity affecting the price of gasoline?
Elasticity is = (dQd/dPG)*(PG/Qd)
dQd/dPG = -10
PG = 20
Qd is = 400
Elasticity is = (-10)*(3/400)
Elasticity is = -0.075
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