The multiplier effect on real GDP from a change in expenditures refers to how much the final GDP will increase or decrease. The size of the multiplier can be determined by the multiplier formula, which is based on the concept of the marginal propensity to consume (MPC).
In other words, it is a measure of how sensitive the economy is to changes in spending. It is a measure of the impact of spending changes on the GDP multiplier. The multiplier effect is the total increase in the GDP resulting from an initial increase in spending. The multiplier effect occurs because every dollar spent is income to someone else. This income can be used to buy more goods and services, creating additional income for others.
This process continues, leading to a larger increase in GDP than the initial increase in spending. The size of the multiplier depends on the MPC. The MPC is the fraction of additional income that is spent on consumption. The larger the MPC, the larger the multiplier. For example, if the MPC is 0.8, a $100 increase in spending will result in a $500 increase in GDP (multiplier of 5). This means that for every $1 increase in spending, the GDP will increase by $5.
The multiplier effect can be positive or negative, depending on whether the economy is in a recession or an expansion. During a recession, a fiscal stimulus package can increase spending and boost the economy. The multiplier effect is positive, meaning that the initial increase in spending results in a larger increase in GDP. However, during an expansion, a fiscal contraction can decrease spending and slow down the economy. The multiplier effect is negative, meaning that the initial decrease in spending results in a larger decrease in GDP.
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Competitive markets maximize the ________ consumer surplus and producer surplus.
This occurs when the economy produces where _________
▼
.
The entire surplus—the sum of consumer surplus and producer surplus—is maximised in competitive markets. When the marginal cost of production and the marginal benefit of consumption are equal, this occurs.
What are the greatest levels of producer and consumer surplus?Consumer surplus is the difference between the maximum price a consumer is prepared to pay and the cost of the good. Profit from selling a good is the same as producer surplus.
What happens when the surplus of consumers is increased?In a competitive market when sellers are making just enough to make a typical profit, consumer surplus is maximised. This not only increases the market's consumer surplus but also ensures the production.
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Morganton Company makes one product, and has provided the following information to help prepare the master budget for its first four months of operations:
The budgeted selling price per unit is $70. Budgeted unit sales for June, July, August, and September are 8,400, 10,000, 12,000, and 13,000 units, respectively. All sales are on credit.
Forty percent of credit sales are collected in the month of the sale and 60% in the following month.
The ending finished goods inventory equals 20% of the following month’s unit sales.
The ending raw materials inventory equals 10% of the following month’s raw materials production needs. Each unit of finished goods requires 5 kilograms of raw materials. The raw materials cost $2.00 per kilogram.
Thirty percent of raw materials purchases are paid for in the month of purchase and 70% in the following month.
The direct labour wage rate is $15 per hour. Each unit of finished goods requires two direct labour-hours.
The variable selling and administrative expense per unit sold is $1.80. The fixed selling and administrative expense per month is $60,000.
Required:
1. What are the budgeted sales for July?
2. What are the expected cash collections for July?
3. What is the accounts receivable balance at the end of July?
4. According to the production budget, how many units should be produced in July?
5. If 61,000 kilograms of raw materials are needed to meet production in August, how many kilograms of raw materials should be purchased in July?
6. What is the estimated cost of raw materials purchases for July?
7. If the cost of raw material purchases in June is $88,880, what are the estimated cash disbursements for raw materials purchases in July?
8. What is the estimated accounts payable balance at the end of July?
9. What is the estimated raw materials inventory balance at the end of July?
1 . $700,000 budgeted sales
2. $632 800 Expected Cash Collection
3 .$420,000 accounts receivable
4. 10,400 production budget units
What are examples of receivables?A receivable is produced whenever money is owed to a company for services done or goods supplied but not yet paid. This can be a sale on shop credit to a client, or a subscription or installment payment owing after products or services have been received.
1. the budgeted sales for July = Budgeted unit sales in July*Budgeted selling price per unit = 10,000 units*$70 per unit = $700,000
2. Expected Cash Collection for July = 40% of July budgeted sales + 60% of June budgeted sale = 40%*$700,000 + 60%*8400 Units*$70 per unit
= $280,000 + $352,800
= $632 800
3. The accounts receivable balance at the end of July = 60% of July Budgeted sale
= 60%*$700,000
= $420,000
4. According to the production budget units should be produced in July
= 80% of July month budgeted unit sale + 20% of the following month’s unit sales
= 80%*10,000 units + 20%*12,000 units
= 10,400 units
Notes: as 20% of the July month Budgeted sales produced in the month of June.
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Which of the following usually serves as the basis for evaluating management's assertions in the context of a financial statement audit?Generally Accepted Accounting Principles (GAAP)International Auditing Standards (IAS)International Financial Reporting Standards (IFRS)Generally Accepted Auditing Standards (GAAS)
The following usually serves as the basis for evaluating management's assertions in the context of a financial statement audit is: Generally Accepted Auditing Standards (GAAS).
Generally Accepted Auditing Standards (GAAS) is a collection of ethical requirements and guidance governing the auditing profession's conduct. GAAS, which is a term that refers to a set of standards against which the quality of audits are evaluated, was created to ensure that auditing practices are consistent and effective. The American Institute of Certified Public Accountants (AICPA) in the United States develops the standards. To determine whether the financial statements are materially misstated or not, an independent auditor performs an audit. The auditor must be licensed by the proper regulatory authority and follow GAAS to perform an audit.
Generally Accepted Auditing Standards (GAAS) are divided into three sections: General Standards, Standards of Field Work, and Standards of Reporting.
The General Standards explain the auditing process's structure and independence. The Standards of Field Work clarify the auditor's responsibilities, the standards of data collection, and the evaluation of results. The Standards of Reporting lay out the auditor's obligations to share the results of an audit in a clear and succinct manner.Know more about Generally Accepted Auditing Standards (GAAS) here:
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Which of the following would an auditor most likely use in determining the auditor's preliminary judgment about materiality for the financial statements as a whole?
A. The anticipated sample size of the planned substantive procedures.
B. The entity's year-to-date financial results and position
C. The results of the internal control questionnaire
D. The contents of the representation letter
An auditor would most likely use the entity's year-to-date financial results and position in determining the auditor's preliminary judgment about the materiality of the financial statements as a whole. Here option B is the correct answer.
This is because materiality is a relative term and is based on the specific circumstances of the entity. The auditor would typically consider quantitative factors such as the size and nature of the financial statements, as well as qualitative factors such as the entity's industry, regulatory environment, and financial condition.
The entity's year-to-date financial results and position would provide important information about the entity's financial condition and performance, which would be a key consideration in determining materiality.
The anticipated sample size of the planned substantive procedures, the results of the internal control questionnaire, and the contents of the representation letter would be used in other aspects of the audit, but would not be the primary factors in determining materiality.
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T/F. One core ethical concept is that you need to act impartially and Not give preferential treatment to any private organization or individual.
the subsequent statement is true that One core ethical concept is that you need to act impartially and not give preferential treatment to any personal organization or individual.
Impartiality is sometimes handled via philosophers as though it have been equal to moral impartiality. Or, at the very least, the former phrase is frequently used, with out the qualifying adjective ‘moral’, even when it's far the specifically moral idea this is intended. this is misleading, considering the fact that impartiality in its broadest experience is excellent understood as a proper belief, at the same time as ethical impartiality particularly is a great concept – and one concerning which there is considerable dispute.
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A customer has a margin account with a long market value of $65,000, a debit balance of $40,000, and SMA of $5,000. The customer buys 500 shares of a listed stock at $20 per share. How much must the customer deposit?
[A] $0
[B] $4,000
[C] $5,000
[D] $10,000
When a customer has a margin account with a long market value of $65,000, a debit balance of $40,000, and SMA of $5,000, and buys 500 shares of a listed stock at $20 per share, they will need to deposit $10,000.Option D
The formula used to determine this is as follows :D = [(LMV x R) - DB] / (1 - ER)
Where: D = Deposit LMV = Long Market Value DB = Debit Balance ER = Margin Requirement Ratio R = Required Maintenance Ratio
Determine the Long Market Value (LMV)LMV = Long Market Value LMV = Market Value x Quantity LMV = $20 x 500LMV = $10,000 Determine the Required Maintenance Ratio (R)R = Required Maintenance Ratio R = 30%R = 0.3
Determine the Margin Requirement Ratio (ER)ER = Margin Requirement Ratio ER = 50%ER = 0.5
Determine the Debit Balance (DB) DB = Debit Balance DB = $40,000Substitute the variables into the formula D = [(LMV x R) - DB] / (1 - ER)D = [($10,000 x 0.3) - $40,000] / (1 - 0.5)D = [$3,000 - $40,000] / 0.5D = -$37,000 / 0.5D = -$74,000
The customer has a debit balance of $40,000, which is greater than the deposit required of -$74,000.
This means the customer needs to deposit the difference between the debit balance and the deposit required. Therefore the correct answer is D = $10,000.
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The absence of a legal system that protects property rights and the lack of machinery to enforce that system in a market economy usually results in:
An improvement in the operating efficiency of newly privatized firms.
Reduced barriers to foreign direct investment and international trade.
An increase in the incentives to engage in economic activity.
Deregulation and privatization of the economy.
The lack of incentive to engage in economic activity
In a market economy, the absence of a legal system that protects property rights and the lack of machinery to enforce that system generally result in a lack of incentive to engage in economic activity.
Hence, option (d) is correct choice.
A market economy is a system in which goods and services are traded on the basis of supply and demand. Market economies allocate resources and fix prices based on the principles of supply and demand. Entrepreneurs are free to start businesses and compete, and buyers and sellers are free to make transactions with one another.
A legal system that protects property rights is essential for a functioning market economy. It allows businesses to acquire and hold property and protect their assets from theft or destruction. When a market economy lacks this legal system, individuals and businesses may have little incentive to engage in economic activity because they cannot be assured that their property and other assets will be protected.
Because of this, the lack of a legal system that protects property rights and the lack of machinery to enforce that system usually result in the lack of incentive to engage in economic activity.
Hence, "option (d)" is correct choice.
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Under which of the following conditions will a low-cost provider strategy likely work?
when there are few ways to achieve product differentiation
when buyers can switch between sellers at low cost
when products of rival sellers are readily available and essentially identical
Low-cost provider strategies will likely work in markets where when buyers can switch between sellers at low cost.
Low-cost provider strategies will likely work in markets where there is a high degree of competition, little product differentiation, and buyers have the ability to easily switch between sellers.
What is low cost provider strategy?
A low-cost producer is a company that offers goods or services at a low cost. In general, low-cost manufacturers take advantage of economies of scale to implement low-price strategies. Price-sensitive consumers are more likely to shop at stores that offer the lowest prices, especially if the goods and services are relatively uniform.
Low cost producers have another option : Pricing goods or services at the same level as competitors and maintaining higher margins.
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1. Avril deposited $800 in his bank at 1.5% for five years.
Use the simple interest formula to calculate the amount of interest Avril will earn.
Calculate the future value of her deposit.
2. Phyllis borrowed $1,000 at 2% APR for six months. Use the simple interest formula to calculate the total amount of interest Phyllis will pay if she pays $200 two months into the loan and the rest at six months.
3. James deposited $500 in his bank at 4.5% for 90 days.
Use the simple interest formula to calculate the amount of interest James will earn using exact interest.
Calculate the future value of the deposit.
4. On May 4 Ariel signed a simple discount note for $3,500 at 3 1/2% for 60 days.
Use the simple interest formula to calculate the amount of interest Ariel will pay using ordinary interest.
Calculate the proceeds she will receive on May 4.
Calculate the amount she will pay at maturity
Determine the date it will be due.
5. What is the APY (effective rate) for 16% APR compounded quarterly? Round to hundredths.
6. Louisa invested $4,500 at 4% interest compounded semiannually for two years. Calculate the future value of Louisa's investment using Exhibit 11-1 or the formula FV = P(1 + R)n.
7. Cleve wants to know how much he would need to deposit now in order to have $8,000 in five years at a rate of 6% compounding quarterly. Use Exhibit 11-2 or the formula P = FV/(1 + R)n.
8. I want to borrow $900 for 20 days from a payday loan store. The payday loan finance charge is $12 per $100 borrowed up to $400, and $10 per 100 on the amount over $400. What is the dollar amount of interest I am paying? What is the APR of this loan?
9. Using Exhibit 12-1 or the formula, calculate the future value of an ordinary annuity with a quarterly payment of $1,000 made at the end of each quarter for four years compounding quarterly at 8%.
10. Using Exhibit 12-1 or the formula, calculate the future value of an annuity due with a monthly payment of $50 made at the beginning of each month for 2.5 years compounding monthly at 6%.
Answer:
800×1.5×5 divided by 100
Explanation:
so 100can divide 800we cancel them remaining 8×1.5×5=60
when the sequel to a movie eventually shows up on their regular television networks, might watch it.
Laggards might watch a sequel to a film when it ultimately airs on their normal tv networks.
Why do you use the term "laggards"?A stock and security that really is underperforming in comparison to its reference or peers is referred to as a lagging. A laggard will see reduced returns in comparison to the market. The antithesis of a leader is a laggard. Traditionalists, laggards who have yet to adopt new ideas. Laggards are localised to the extent of being isolated when contrasted to the other user types, having essentially no opinion leadership. Because of their fixation with the past, all choices must be considered in the context of earlier generations.
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Robyn was a lawyer for the Department of State who has been disbarred for ethical lapses including dishonesty and interfering with investigations.
After losing his license to practice law, he was fired from the State Department. What MOST likely must Robyn do now?
A. Appeal his case to the American Bar Association.
B. Find a new career outside the legal profession.
C. Wait a year and reapply for his license.
D. Take his case to an appeals court.
The most likely thing for Robyn to do is B. Find a new career outside the legal profession.
Why does Robyn need to leave the legal profession ?Since he has lost his license to practice law, he would not be able to continue working as a lawyer or in any other legal capacity. In addition, his firing from the State Department would likely make it difficult for him to find employment in a related government agency.
Therefore, the most realistic option for Robyn would be to seek employment in a different field or industry. Appealing his case to the American Bar Association or taking his case to an appeals court would likely not be fruitful options, as his disbarment and firing from the State Department suggest that his ethical lapses were significant and serious.
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If a store orders 100 units every time and sells 90 units each week, what is the average inventory?
Answer:
If a store orders 100 units every time and sells 90 units each week, the average inventory can be calculated as follows:
Each time the store orders 100 units, the inventory increases by 100 units.
Each week, the store sells 90 units, so the inventory decreases by 90 units.
Assuming that the store orders new inventory as soon as it runs out, the average inventory can be estimated as the average of the minimum and maximum inventory levels.
The minimum inventory level occurs just before a new order is placed, when the inventory has been depleted to 10 units. The maximum inventory level occurs just after a new order is received, when the inventory has been replenished to 100 units.
Therefore, the average inventory is:
(10 + 100) / 2 = 55
So, the average inventory is 55 units.
Acording to leader member exchange. you must work to develop special relationship whit
Option (d), In accordance with leader-member exchange, you must put out effort to cultivate unique bonds with your followers. This leads to more productive team meetings if you do it.
How does the leader-member swap technique function?The Leader-Member Exchange Hypothesis first came to light in the 1970s. It looks at the interaction between management and the team. Team members frequently move through the three stages of role-taking, role-making, and routineization when interacting with their management.
How can leaders use the Leader-Member Exchange Theory to effectively manage their teams?As they have limited time and resources, leaders divide their subordinates into in- and out-groups to increase work-group productivity, according to the leader-member-exchange (LMX) theory of leadership (Dansereau, Graen, & Haga, 1975).
According to the leader-member exchange paradigm, what qualifies as the "out group"?Out-group: If a worker and their management don't trust one another, that manager typically sees the employee as being in the minority. The likelihood that these individuals may leave the team may increase as a result, and they may also experience lower job satisfaction and lower levels of motivation.
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The complete question is:
According to leader-member exchange, you must work to develop special relationships with your followers. If you do this, it results in which of the following?
an entire work group becoming an in-group
an entire work group becoming an out-group
increased job satisfaction
more effective team meetings
true/false. in a scenario where two goods can be produced by two different people, one person may have a comparative advantage in the production of both goods.
True. In a scenario where two goods can be produced by two different people, one person may have a comparative advantage in the production of both goods.
Comparative advantage is the ability to produce a good at a lower opportunity cost than another producer. It is a situation in which one person can produce a good or service at a lower cost than another. For example, one person may be able to produce two units of a good with two hours of work, while the other person needs four hours to produce two units. The first person has a comparative advantage in the production of the good. However, the comparative advantage may change over time if one person's cost of production decreases.
For instance, if the first person develops new skills or finds a new resource to produce the good, they may be able to produce two units with only one hour of work, while the other person still needs four hours. In this scenario, the first person now has a comparative advantage in the production of the good.
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Tom is responsible for project managers who supervise others who perform manual work. He reports to a vice president on another continent. Tom is a:A) first line manager.B) middle manager.C) top manager.D) nonmanager.
Middle managers, such as Tom, are responsible for supervising project managers and other lower-level staff.
What is supervising project manager?A Supervising Project Manager is a senior-level professional who is responsible for overseeing and managing the day-to-day operations of a project. They are responsible for making sure that the project is executed efficiently and effectively, and that deadlines are met. They plan and coordinate all aspects of the project, including budget, timelines, resources, and staff. They also monitor and report on project progress and ensure that project goals are met. They provide technical guidance to project team members and ensure that they are following the project plan. They may also be involved in conflict resolution and leadership development. Supervising Project Managers serve as the primary point of contact between the project team, the customer, and other stakeholders.
They typically report to a higher-level executive, such as a vice president, who is located on another continent. As such, Tom is a middle manager.
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FILL IN THE BLANK Basically PERT simulation assumes a statistical distribution, range between ___ and ___, for each duration.
Basically, the PERT simulation assumes a statistical distribution, range between pessimistic and optimistic for each duration. PERT or Program Evaluation and Review Technique are used to estimate the duration of activities needed to complete a project.
The Program Evaluation and Review Technique or PERT simulation was developed to help project managers estimate the duration of activities needed to complete a project. It was developed in the United States Navy for the Polaris missile project.
PERT uses the Beta Distribution Model, which is a probabilistic model of uncertainties, to estimate the duration of activities. In PERT, each activity has three time estimates: optimistic, pessimistic, and most likely.
The expected time, t, is calculated using the following formula: t = (optimistic + 4 × most likely + pessimistic) / 6.The variance, σ², is calculated using the following formula:σ² = [(pessimistic - optimistic) / 6]².
According to PERT, the duration of an activity can be estimated by using the formula: T = t + zσ.where T is the estimated duration of the activity, t is the expected time of the activity, σ is the standard deviation of the activity, and z is the standard score of the activity that corresponds to a given confidence level.
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Belinda Broker, who owns a real estate office with five salespeople, dies unexpectedly. Sam Salesperson, who works in Belinda's, office has four listings. What should Sam do once he learns of Belinda's demise?
Answer:
Belinda Broker, who owns a real estate office with five salespeople, dies unexpectedly. Sam Salesperson, who works in Belinda's, office has four listings. What should Sam do once he learns of Belinda's demise?
Explanation:
Once Sam Salesperson learns of Belinda Broker's demise, he should take the following steps:
Notify the appropriate authorities: Sam should notify the police or emergency services, as well as the relevant government agencies, such as the local licensing board for real estate agents.
Contact Belinda's family or executor: Sam should reach out to Belinda's family or executor to offer condolences and inquire about how the business will be handled in the wake of her passing.
Assess the situation: Sam should take stock of the office's current listings, pending sales, and other ongoing business transactions to determine the status of each.
Inform clients: Sam should contact all clients he is currently working with to inform them of Belinda's passing and reassure them that he will continue to handle their transactions.
Seek guidance and support: Sam should seek guidance from colleagues, industry associations, or legal counsel as needed to ensure he is following proper procedures and protocols.
Respect confidentiality: Sam should handle any confidential client or business information with utmost care and confidentiality.
Ultimately, it is important for Sam to act professionally and compassionately in the wake of Belinda's passing while taking the necessary steps to ensure that the real estate office and its clients are properly managed during this transition period.
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Vernon Medical Clinic has budgeted the following cash flows.
January February March
Cash receipts $ 117,000 $ 123,000 $ 143,000
Cash payments
For inventory purchases 98,500 80,500 93,500
For S&A expenses 39,500 40,500 35,500
Vernon Medical had a cash balance of $16,500 on January 1. The company desires to maintain a cash balance of $10,000. Funds are assumed to be borrowed, in increments of $1,000, and repaid on the last day of each month; the interest rate is 3 percent per month. Repayments may be made in any amount available. Vernon pays its vendors on the last day of the month also. The company had a monthly $40,000 beginning balance in its line of credit liability account from this year’s quarterly results.
The journal entries for Vernon Medical Clinic is given below:
The Journal EntriesCash Budget January February March
Cash receipts
Beginning cash balance 16500 10300 10000
cash receipts 117000 123000 143000
Total cash available [1] 133500 133300 153000
Cash payments
For inventory purchases 98500 80500 93500
For S & A Expenses 39500 40500 35500
Interest expense 40000*3%=1200 56000*3%=1680 55380*3%= 1661
Total budgeted disbursements [2] 139200 122680 130661
Excess of receipts over disbursement [1-2] -5700 10620 22339
Financing activities
Borrowing /(repayment) 16000 (620) (12339)
Ending cash balance 10300 10000 10000
Working note:
a)For month of January,Amount borrowed = Desired ending balance - Excess of receipts over disbursement
= 10000 - (-5700)
= 10000 +5700
= 15700 (rounded to nearest 16000)
Since the amount is borrowed in increments of 1000 ,amount borrowed is nearest to 16000
b)Amount financed at end of January = 40000 (beginning ) +16000 additional borrowing = 56000
c)Amount financed at end of February = 56000 (beginning ) -620 repatyment= 55380
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according to clients, what are the obstacles to implementing an integrated marketing communications process? (check all that apply.)
The most common obstacles to implementing an integrated marketing communications process, as reported by clients, include a lack of a unified vision and strategy, limited resources, and an inability to measure results.
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fill in the blank. if the pound sterling appreciates against the u.s. dollar, england buys___u.s. goods, causing the u.s. aggregate demand curve to shift to the___.
If the pound sterling appreciates against the US dollar, England buys fewer US goods, causing the US aggregate demand curve to shift to the left.
If the pound sterling appreciates against the US dollar, England buys fewer US goods, causing the US aggregate demand curve to shift to the left. The shift in demand results in a reduction in output and a shift in the equilibrium. The US may counteract this shift by employing various policies to increase the demand for its goods or reduce its reliance on exports.
The strength of a country's currency is determined by supply and demand. The value of a currency is determined by supply and demand. The value of a country's currency increases when there is a high demand for it or when the supply of it is limited. A country's currency may decrease in value when there is low demand or an overabundance of it. In this case, the pound sterling appreciates relative to the US dollar, indicating that there is a higher demand for pounds in relation to the supply, or a lower supply of US dollars in relation to the demand.
When a country's currency appreciates, its exports become more expensive and less competitive in foreign markets. This reduces the demand for its exports. At the same time, imports become cheaper, and demand for imported goods increases. In the case of England, the country is buying fewer US goods, indicating that it is reducing its imports from the US. The US, on the other hand, is experiencing a reduction in demand for its exports to England, and this shift in demand reduces the aggregate demand curve for the US. The reduction in aggregate demand causes a decrease in the equilibrium output level, and this shift is to the left of the aggregate demand curve.
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In general the CPI only monitors the prices of goods overtime. It usually does not adjust for changes in the ___
In general the CPI only monitors the prices of goods overtime. It usually does not adjust for changes in the quality of goods.
What does CPI monitors in an economy?The Consumer Price Index (CPI) is the primary economic indicator used to track a country's inflation rate and the cost of living. It consists of a basket of goods and services, with the basket price calculated as a weighted average of the retail prices of the constituent items.
CPI is published monthly, but quarterly and annual reports are also common. The regular release of CPI reports allows us to examine the change in prices of individual items as well as the basket as a whole over time. The inflation rate is the rate at which the basket price changes over time.
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Oil spill case study
One of the most well-known oil spill case studies is the Deepwater Horizon oil spill that occurred in 2010.
What is oil spill?An oil spill occurs when crude oil or refined petroleum products are released into the environment, typically into water bodies such as oceans, rivers, or lakes. These spills can happen due to various reasons, including accidents during oil drilling or transportation, equipment malfunctions, or natural disasters. Oil spills can have severe ecological and economic consequences, as they can harm or kill marine animals and birds, damage habitats, and impact the fishing and tourism industries. The extent of the damage caused by an oil spill depends on the type and amount of oil released, the location of the spill, and the effectiveness of the cleanup efforts. Quick and effective response is critical in mitigating the damage caused by oil spills.
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Complete Question is: What is the most well know Oil spill case study?
Broussard Skateboard's sales are expected to increase by 25% from $7.2 million in 2019 to $9.00 million in 2020. Its assets totaled $5 million at the end of 2019.
Broussard is already at full capacity, so its assets must grow at the same rate as projected sales. At the end of 2019, current liabilities were $1.4 million, consisting of $450000 of accounts payable, $500000 of notes payable, and $450000 of accruals. The after-tax profit margin is forecasted to be 3%, and the forecasted payout ratio is 55%. Use the AFN equation to forecast Broussard's additional funds needed for the coming year.
Answer:
Explanation:
The AFN (Additional Funds Needed) equation is:
AFN = (A*/S)ΔS - (L/S)*ΔS - M(1 - P)*ΔS
Where:
A* = assets that vary directly with sales
S = projected sales
ΔS = increase in sales
L* = spontaneous liabilities that vary directly with sales
M = after-tax profit margin
P = payout ratio
First, we need to calculate the assets that vary directly with sales. Since Broussard is already at full capacity, its assets must grow at the same rate as projected sales. Therefore, A* = S.
Next, we need to calculate the spontaneous liabilities that vary directly with sales. These are the current liabilities, which are already included in the AFN equation. Therefore, L* = current liabilities = $1.4 million.
The projected sales are not given in the question, so we cannot calculate the increase in sales. However, we can still calculate the AFN based on a percentage increase in sales. Let's assume a 10% increase in sales.
Using the given information, we can calculate the other variables:
M = after-tax profit margin = 3%
P = payout ratio = 55%
Substituting these values into the AFN equation, we get:
AFN = (A*/S)ΔS - (L/S)*ΔS - M(1 - P)*ΔS
AFN = (S/S)*0.10S - ($1.4 million/S)*0.10S - 0.03(1 - 0.55)*0.10S
AFN = 0.007S
Therefore, the additional funds needed for the coming year, based on a 10% increase in sales, is 0.7% of projected sales.
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Answer:
Broussard Skateboard's sales are expected to increase by 25% from $7.2 million in 2019 to $9.00 million in 2020. Its assets totaled $5 million at the end of 2019.
Broussard is already at full capacity, so its assets must grow at the same rate as projected sales. At the end of 2019, current liabilities were $1.4 million, consisting of $450000 of accounts payable, $500000 of notes payable, and $450000 of accruals. The after-tax profit margin is forecasted to be 3%, and the forecasted payout ratio is 55%. Use the AFN equation to forecast Broussard's additional funds needed for the coming year.
The additional funds needed (AFN) equation is:
AFN = (A*/S0)ΔS - (L*/S0)ΔS - MS1(1 - d)
where:
A* = Total assets needed to support sales
S0 = Sales in the previous period
ΔS = Projected increase in sales
L* = Total spontaneous liabilities at capacity
M = Profit margin
d = Dividend payout ratio
S1 = Projected total sales
We can start by calculating the variables needed for the AFN equation:
A* = S1 × (A/S)
A* = $9.00 million × ($5 million / $7.2 million)
A* = $6.25 million
ΔS = $9.00 million − $7.2 million = $1.8 million
L* = $450000 + $500000 + $450000 = $1.4 million
M = 3%
d = 55%
S1 = $9.00 million
Now we can substitute these values into the AFN equation:
AFN = ($6.25 million / $7.2 million) × $1.8 million − ($1.4 million / $7.2 million) × $1.8 million − 0.03 × $9.00 million × (1 - 0.55)
AFN = $1.25 million − $0.28 million − $0.135 million
AFN = $0.79 million
Therefore, Broussard Skateboard's additional funds needed for the coming year is $0.79 million.
When you go to a financial institution to obtain a loan, the rate of interest normally quoted will be 45) the. A) effective rate. B) quoted rate.
When you go to a financial institution to obtain a loan, the rate of interest normally quoted will be the quoted rate, option B is correct.
The quoted rate is the interest rate that is advertised by the bank or lender, and it is the interest rate that the borrower is told when they apply for a loan. When you go to a financial institution to obtain a loan, the rate of interest that is normally quoted is the quoted rate. In other words, the quoted rate is the rate that you will pay on the loan.There are two types of interest rates: quoted and effective. The quoted rate is the advertised rate that the borrower is told when they apply for a loan, and it is the interest rate that the bank or lender will charge on the loan. The effective rate, on the other hand, is the actual rate that the borrower will pay after taking into account all of the fees and charges associated with the loan.The effective rate is the rate that takes into account all of the fees and charges associated with the loan. This includes things like application fees, origination fees, and closing costs. The effective rate is the true cost of borrowing, and it is the rate that you will actually pay on the loan after all of the fees and charges have been taken into account.In conclusion, when you go to a financial institution to obtain a loan, the rate of interest normally quoted will be the quoted rate. The quoted rate is the advertised rate that the borrower is told when they apply for a loan, and it is the interest rate that the bank or lender will charge on the loan.for more such question on financial
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Note: The complete question would be as bellow,
When you go to a financial institution to obtain a loan, the rate of interest normally quoted will be the. A) effective rate. B) quoted rate. C) Normal Rate. D) None of the above
You know of a situation where a rep "sold dividends" to one of his customers who purchased mutual fund shares yesterday. Why is "selling dividends" bad for the customer?
Within 30 days of the dividend declaration date, the transfer agent may cancel the dividend.
The dividend received by the fund house is in cash, as opposed to equities. Not to your bank account, though. The fund's AUM grows as a result of dividend payments and bonus issues, which raises the fund's NAV.
A wash sale typically happens when you sell securities at a loss and then purchase the same shares within 30 days of the sale date. Wash sale regulations are intended to stop investors from making a deductible loss to offset gains with only a brief break in ownership of the security.
These dividends are a portion of the profits that a business distributes to its stockholders.
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Good A has 5 substitutes, Good B has 10 substitutes, good C has 15 substitutes, and Good D has 20 substitutes. Other things being equal, the good with the greatest price elasticity of demand is: Good A. Good B. Good C. Good D.
Good D in this instance has 20 substitutes, making it the right choice.
How does the replacement impact change the demand curve?The main mechanism of the substitution effect is that if the price of a good rises relative to its substitute, more of the substituted good will be demanded. Conversely, less of the given good will be demanded.
The drop in sales of a product brought on by consumers switching to less inexpensive replacements as the product's price rises is known as the substitution effect. Although there are many potential causes for a product losing market share, thriftiness is the sole factor that can be reflected in the impact of substitution.
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(1 point) The number x of stereo speakers a retail chain is willing to sell per week at a price of p dollars is given by x = 83 Vp + 23 – 400. Find the supply and instantaneous rate of change of supply when the price is 75 dollars. Supply = Instantaneous rate of change of supply =
The supply of stereo speakers when the price is $75 is 83($75) + 23 - 400 = -158 speakers. The instantaneous rate of change of supply when the price is $75 is 83, as this is the coefficient of the variable p.
Solution,
Given that the number x of stereo speakers a retail chain is willing to sell per week at a price of p dollars is given byx = 83 Vp + 23 – 400.Put p = 75x = 83*75 + 23 – 400= 6255 speakers
So, the supply is 6255 when the price is 75 dollars. To find the instantaneous rate of change of supply, differentiate the given function with respect to
p.(dx/dp) = 83d/dp(p) + d/dp(23) - d/dp(400)(dx/dp) = 83
Since the value of dx/dp is constant, the instantaneous rate of change of supply is 83.
Therefore, the supply is 6255 and the instantaneous rate of change of supply is 83 when the price is 75 dollars.
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TRUE/FALSE. A person who buys a franchise has the same level of control as an entrepreneur who opens his or her own sole proprietorship.
FALSE. A person who buys a franchise does not have the same level of control as an entrepreneur who opens his or her own sole proprietorship.
A franchisee is required to follow the franchise agreement and operate the business according to the franchisor's standards and guidelines. The franchisor typically has a great deal of control over the franchisee's business, including the products or services offered, pricing, marketing, and more.
In contrast, an entrepreneur who opens his or her own sole proprietorship has complete control over the business and can make all the decisions about how to operate it.
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as the labor force ages and retires, we would expect the production possibility frontier to do which of the following?
As the labor force ages and retires, we would expect the production possibility frontier to shift inwards because of the reduction of labor power available.
Production possibility frontier or PPF is a graphical representation of the concept of production possibility, which refers to the possible combinations of two goods that can be produced in a given period, given the available resources and the level of technology. The PPF curve displays the maximum amount of one product that can be produced for every feasible level of production of the other product. It can also be defined as the boundary between the feasible and unfeasible combinations of the two goods.
When the labor force ages and retires, the production possibility frontier will shift inwards. This happens because the labor force's size decreases, so there will be less labor force power available to produce goods and services.The productivity of the labor force will also decrease, as they will start to have age-related health issues that limit their capabilities. All these factors combined, cause a decrease in the output of goods and services.
In conclusion, as the labor force ages and retires, we would expect the production possibility frontier to shift inwards because of the reduction of labor power available.
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fill in the blank. the form of entry strategy into international operations that offers the___level of control for the domestic corporation would be exporting.
The form of entry strategy into international operations that offers the highest level of control for the domestic corporation would be exporting.
This is because exporting refers to the act of selling goods and services from one country to another, thereby maintaining complete control of production and distribution. Exporting is one of the most straightforward and cost-effective methods of entering international markets. It is frequently used by small to medium-sized businesses that are interested in expanding their operations to a foreign market without committing a lot of resources. In addition, the exporting firm can maintain complete control over the goods and services that it provides, allowing it to preserve its branding and reputation in foreign markets. Exporting does, however, have its drawbacks.
The firm may face trade barriers in the form of tariffs, quotas, or other non-tariff barriers that restrict entry to foreign markets. Furthermore, exporting is typically seen as a short-term approach to international expansion, as it lacks the long-term sustainability of investment-based approaches such as joint ventures, mergers, or acquisitions. To sum up, while exporting provides complete control for domestic corporations in international operations, it is frequently seen as a temporary solution rather than a long-term approach to expanding to foreign markets.
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