Economics Answers

Why do many companies use a positive number instead of zero for the NPV rule?

the inverse demand functions of two towns for a product are given as
( Q1/2)^1/4=P and (2/10-Q1/10)=P find the market demand of these two towns

Question 2
The following details appeared in the final accounts of a sole trader's business.
Current assets
R
8 400
Current liabilities 4 000
Gross profit 5 000
Net profit 2 400
Purchases 16 000
Sales 21 000
Capital 30 000
The opening and closing stocks, being identical figures, are not shown.
Required
Answer the following questions:
(a) What is the ratio between current assets and current liabilities, and
is it a satisfactory one?
(b) What is the percentage gross profit on turnover?
(c) What is the average mark-up percentage on purchases?
(d) What is the capital yield to the owner expressed as a percentage?
(e) Would the owner do better by investing his capital in a building
society at 2
7 1 % per annum? (15)

Suppose investor A has $20,000 in his account and derives 4 utiles of Utility from this amount and would derive 5 Utiles of Utility if he had $40,000. He is faced with a choice to invest the $20,000 in a project that has 60% probability of earning a profit of $20,000 and 40% probability of losing $20,000?

Is the manager likely to invest in the project?

A project has expected risky cash flows of $45,000 in Perpetuity. Given that the risk adjusted rate of return for the project is 15%, and the risk free rate is 5%, What are the certainty equivalent cash flows in perpetuity?

The demand Curve facing a firm operating under monopoly is given by P = 85 - 2.5Q; The cost function is given by TC = 20 + 25Q + 2,5Q^2.

1) What is the Maximum profit?

2) What is the Profit Maximizing Price Elasticity of demand?

3)What is the Revenue Maximizing Price elasticity of demand?

You are given that the equilibrium price and quantity of a product A are $30 and 2Kg respectively. 1)What is the marginal revenue when the price elasticity of demand is -3?
2)What is the Marginal Revenue when the quantity is 4?

You are given that the equilibrium price and quantity of a product A are $30 and 2Kg respectively. What is the marginal revenue when the price elasticity of demand is -3?

BIT Bank (in millions) Assets Liabilities Reserves $48 Deposits $340 Loans $360 Bank Capital $68 NAT Bank (in millions) Assets Liabilities Reserves $48 Deposits $400 Loans $360 Bank Capital $8 Assume that both BIT Bank and NAT Bank have the same net profit after tax of $8 million. a. Calculate for each bank, BIT Bank and NAT Bank, its: i. return on assets (ROA); ii. return on equity (ROE); and iii. leverage ratio. Show all your calculations. b. With reference to your answers in (a), which Bank (Bank BIT or Bank NAT) is more attractive for shareholders? Show your calculations to explain your answers. c. Which bank (Bank BIT or Bank NAT) is riskier in case of loan depreciation at $60 million? Explain. Show your calculations to explain your answers.

Since the Uk government has decided to exit from the EU market the automobile industry will face a huge loss in this if the hard brexit is applied by the government and the automobile industry are facing problems how can the government and central bank help the automobile industry ?

A short-run average total cost or average cost curve is given by the
equation"
SAC (Q)= 12/Q+0.14Q

Derive expressions for the corresponding short-run total cost, short-run average variable
cost, and short-run average fixed cost.