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Label the curves in the following graph.
a. At each market price, P1, P2, and P3, at what output level would the firm produce?
b. What profit would be earned if the market price was P1?
c. What are the shutdown and break-even prices
Cost figures for a hypothetical firm are given in the following table. Use them for the exercises
below. The firm is selling in a perfectly competitive market.
a. Fill in the blank columns.
b. What is the minimum price needed by the firm to break even?
c. What is the shutdown price?
d. At a price of $40, what output level would the firm produce? What would its profits be?
The Arun ice cream’s lowers the price of its vanilla ice cream from Rs.55/- per kg to Rs.40/ kg. Vanilla ice cream sales increases by 20 %. The company notices that the sales of chocolate syrup increased by 10 %.
a. What is the price elasticity co-efficient of vanilla ice cream?
b. Why have the sales of chocolate syrup increased and how would you measure the effect?
c. Overall, do you think that the new price policy was beneficial for the Arun ice cream?
you are thinking of setting up a cendol stall. The stall itself will cost RM200. The ingredients for each bowl of cendol will cost RM0.50. Construct a table showing your total cost, average total cost, and marginal cost for output levels varying from 0 to 10 litre of cendol. Draw the three cost curves.
(Hint: There are 16 bowls in a litre of cendol.
If the government places a P250,000 tax on luxury cars, will the price paid by consumers rise by more than P250,000, less than P250,000, or exactly P250,000?
Directions: Provide the answer to the following financial ratios problem:
NOTE: USE UP TO TWO DECIMAL PLACES ONLY
6. GROSS PROFIT MARGIN= 0.60
INVENTORY TURNOVER= 3
AVERAGE INVENTORY= P 450,000
NET PROFIT MARGIN= 0.12
NET PROFIT= ?
7. CURRENT RATIO = 4
DEBT RATIO= 0.2
EQUITY= P 600,000
NONCURRENT ASSETS= P 200,000
NONCURRENT LIABILITIES= ?
8. AVERAGE DAYS IN INVENTORY= 20
INVENTORY TURNOVER= ?
9. CURRENT LIABILITIES= 50% OF TOTAL ASSETS
CURRENT ASSETS= 75% OF TOTAL ASSETS
CURRENT RATIO= ?
10. NET PROFIT= P 300,000, MARGIN= 0.1
INCOME TAX EXPENSES= 25% OF OPERATING PROFIT
OPERATING PROFIT MARGIN= ?
There are four consumers willing to pay the following amounts for haircuts: Jerry: $7; Oprah: $2; Ellen: $8; and Phil: $5 There are four haircutting businesses with the following costs: Firm A: $3; Firm B: $6; Firm C: $4; and Firm D: $2 Each firm has the capacity to produce only one haircut. For efficiency, how many haircuts should be given? Which businesses should cut hair and which consumers should have their hair cut? How large is the maximum possible total surplus?
Assignment 1.(a)Discuss what a financial system is and the key role that any financial system plays in an economy. ,(b)What are the main reasons for regulating financial institutions and how do the regulators do this?.
General guide :
Assignment should be at least 4 pages excluding the title page and references
Spacing should be at least 1.5
Attach the “turn it in certificate”
(50marks)
A tour operating firm plans to take tourists between Addis Ababa and Jimma. its estimated cost function given by C =100 +50 N+4N2 (Where N denotes the number of passengers per day)
A. State the average cost function.
B. State the marginal cost of the average cost function.
C. Find the number of passengers per day that minimize average cost.
D. What is the minimum average cost at the optimal level of passenger?
E. What will be the total cost at the optimal level?
Hoot Washington is the newly elected leader of the IN US. Media Publishers is negotiating to publish Hoot’s Manifesto, a new book that promises to be an instant best-seller. The fixed costs of producing & marketing the book will be $500,000. The variable costs of producing and marketing will be $4.00 per copy sold. These costs are before any payments to Hoot. Hoot negotiates an up-front payment of $3 million, plus a 15% royalty rate on the net sales price of each book. The net sales price is the listed bookstore price of $30, minus the margin paid to the bookstore to sell the book. The normal bookstore margin of 30% of the listed bookstore price is expected to apply.
1. Prepare a PV graph for Media Publishers.
2. How many copies must Media Publishers sell to (a) break even and (b) earn a target operating income of $2 million
