With current technology, suppose a firm is producing 800 loaves of banana bread daily. Also assume that the least-cost combination of resources in producing those loaves is 6 units of labor, 5 units of land, 4 units of capital, and 2 units of entrepreneurial ability, selling at prices of $40, $60, $60, and $20, respectively. Required:
1. Assume the firm can sell these 800 loaves at $1 per unit, will it continue to produce banana bread?2. What is the firm's total revenue?3. What is the firm's total cost?4. What is the firm's profit or loss?
Answers
Answer:
1. No
2. $800
3. 820
4. Loss = $-20
Explanation:
Total revenue = price x quantity = 800 x $1 = $800
Total cost = ( 6 x $40) + (5 × $60) + (4 × $60) + (2 × $20) = $820
Profit / loss = Total revenue - Total cost
$800 - $820 = $-20
Because the firm is earning a loss, the firm would not continue to produce.
I hope my answer helps you.
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Answers
Answer:
The journal entry to record the dividend declaration is:
June 2, 202x, cash dividends are declared
Dr Retained earnings 4,800
Cr Dividends payable 4,800
The journal entry to record the payment of the dividend would be:
Dr Dividends payable 4,800
Cr Cash 4,800
When we calculate dividends, only outstanding stocks are included in the distribution: total outstanding stocks = issued stocks - treasury stocks = 1,000 - 200 = 800
Answers
Answer:
Midpoint formula = - 7.43
Other formula = - 4.88
Elastic PED - Decrease price to increase total revenue
Explanation:
Price elasticity of demand is the responsiveness of quantity demanded to a change in price. The midpoint formula calculation is as follows:
(Q2 - Q1) / [(Q2 + Q1/2]
(P2 - P1) / [(P2 + P1/2]
In this scenario:
Q1 = 433 (old quantity)
Q2 = 169 (new quantity)
P1 = 0.88 (old price)
P2 = 0.99 (new price)
When this is substituted into the formula, it is as follows (I shall do it one step at a time to make it easier):
(169 - 433) / [(169 + 433/2]
(0.99 - 0.88) / [(0.99 + 0.88/2]
(169 - 433) / 301
(0.99 - 0.88) / 0.935
- 264 / 301
0.11 / 0.935
- 0.877
0.118
PED =- 7.43(PED is always a negative figure because price and quantity demanded have an inverse relationship. i.e. when one falls, the other rises)
PED is elastic if it is more than 1 and elastic if it is less than 1.
In this case, 5.8 is more than 1, hence PED is elastic.
In such a case, a change in price will always lead to a higher change in quantity demanded. Therefore, it is important to decrease the price to increase total revenue.
However, a different answer can be obtained using a different PED calculation
% change in quantity demanded
% change in price
(Q2 - Q1) / Q1
(P2 - P1) / P1
(433 - 169) / 433
(0.99 - 0.88) / 0.88
0.61
0.125
PED = - 4.88
Answers
Answer:
z = 0.96, standard deviations to the right of the mean 170 cm
Explanation:
z=
x = 176 cm is 0.96, standard deviations to the right of the mean 170 cm
2. The price of lumber, a commodity, rises drastically due to the effect of heavy winter weather in the American Northwest, where much of the world's lumber is grown.
3. The production of a new type of blade for their combine harvesters, a tractor used to harvest crops, has allowed wheat farmers, like Herbert, to increase productivity by 40%.
Answers
Answer:
1.Aggregate supply falls
2.Aggregate supply falls
3.Aggregate supply rises due to rise in productivity.
Explanation:
1. In simple words, when the cost of production rises the profit margin of the supplier decreases leading as an incentive to supply less.
2. If the price of the input rises the cost of production also rises leading to lower supply because of lower profit margins.
3. The technological improvement leading to high production would lead to more profits and advantage of economies of scale thus working as an invective to supply more.
B. not be covering their total fixed costs.
C. not be covering their total variable costs.
D. a and b b and c
Answers
In long-run competitive equilibrium SRATC = LRATC, because if SRATC > LRATC (at the quantity of output at which MR = MC) firms would have an incentive to change their plant size to produce their current output.
Option: A
Explanation:
In perfect competition, balance is the stage where consumer demands are equal to market supply. In the short term demand can impact stability. In the long run both a product's demand and supply would influence the balance in perfect competition.
The increase in the quantity of output generated is the SRTC i.e short-run total cost and LRTC i.e long-run total cost scales because generating more output needs more labor utilization for both the short and long runs, and since, in the long run, generating more output implies using more of the physical resource supply; and by using more of either supply means incurring more production costs.
Answers
Answer:
After each purchase
Explanation:
perpetual inventory system can be regarded as a kind of inventory management that utilize technology in the documentation of real-time transactions whenever stock is received or sold, this method is reliable and the efficiency is high compare to
periodic inventory system. It should be noted that When using a perpetual inventory system and the weighted-average inventory costing method, a new weighted-average cost per unit is computed after each purchase. perpetual inventory system can be use by gocesory stores.