Yerke Company makes jungle gyms and tree houses for children. For jungle gyms, the price is $120 and variable expenses are $90 per unit. For tree houses, the price is $200 and variable expenses are $100. Total fixed expenses are $253,750. Last year, Yerke sold 12,000 gyms and 4,000 tree houses. Now suppose that Yerke expects tree house demand to increase from 4,000 to 8,000 units. What is the number of jungle gyms sold at break-even?

1,750

668

2,625

1,002

875

12,Western Electric has 29,500 shares of common stock outstanding at a price per share of $74 and a rate of return of 13.25 percent. The firm has 7,050 shares of 7.30 percent preferred stock outstanding at a price of $92.50 per share. The preferred stock has a par value of $100. The outstanding debt has a total face value of $389,000 and currently sells for 108.5 percent of face. The yield to maturity on the debt is 7.93 percent. What is the firm's weighted average cost of capital if the tax rate is 39 percent?

A mail-order house uses 15,950 boxes a year. Carrying costs are 69 cents per box a year, and ordering costs are $100. The following price schedule applies.

a. Determine the optimal order quantity. (Round your answer to the nearest whole number.)
  

b. Determine the number of orders per year. (Round your answer to 2 decimal places.)
  

What’s value of a preferred stock if we assume it has a quarterly dividend $1.25 per share and the required rate of return is 10%?

Other than dividend growth model, we can employ Market Multiple Analysis method for stock valuation. We suppose a firm's estimated earnings per share is $2. The average price to earnings (P/E) ratio for similarly publicly traded firms is 10. What's the firm's expected stock price?

a building supply store prices all products to give a one third (33.33%)margin.
a.what rate of markup do they use?
b.if the company had profits of$500,000 what was their cost of goods sold?
c.if operating expenses are 10% of sales what is the percent net profit?
d.a mitre saw had a cost of$100 what was the selling price?
e.a pressure washer which costs $120 was sold after being marked down 20% what was the selling price ?what was the percent margin.

Suppose that Apple’s current stock price is $120.56 and a call option with a 3-month maturity

on Apple stock and an exercise price of X = 130 currently sells for $7.00. Suppose that you

buy one call contract and hold it till expiration. Keeping in mind that a call contract is written

on 100 shares, determine the dollar payoffs, dollar and percentage profit/loss for this option

position for each of the following closing prices of Apple stock (ST) on option expiration day

a) ST= 120

b) ST= 130

c) ST= 145

Suppose the United States could import footwear from Thailand at the price of $20 per pair or from Mexico at $24 per pair. The domestic price of footwear in the United States is $35. Suppose prior to NAFTA, the U.S. imposed a 50% tariff on all footwear entering the country. Suppose the US demand for footwear is given by Q = 100 – 2P. Assume US producers face a constant MC = $35. What is the welfare effect of joining the NAFTA for the US if doing so requires eliminating the tariff on Mexican made footwear?

The twenty-year bond yields 6.1% and has a coupon of 8.1%. If this yield to maturity remains unchanged, what will be its price one year hence? Assume annual coupon payments and a face value of $100. (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Price            $

b. What is the total return to an investor who held the bond over this year? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)

Total return             %

1) When income is $100 per week, 10 units of good X are demanded. When income is $150 per week, 15 units of good X are demanded. The income elasticity of demand of good X equals to

1. 11/5
2. 5/11
3. 1
4. 10/15
5. 100/150

2) If goods X and Y are substitutes, then the cross elasticity of demand will be

1. positive
2. negative
3. zero
4. greater than 1
5. greater than zero but less than 1

3) When the price of silver rises, there will be

1. no change in quantity demanded
2. supply and demand will interact accordingly
3. a movement along the good's supply curve
4. both an outward shift in the demand for the good and a movement along the good's demand curve
5. an outward shift in the demand for the good

4) When price is $5 per unit, quantity demanded is 12 units. When price is $8 per unit, quantity demanded is 6 units. The value of the price elasticity of demand is approximately (before taking absolute value)

1. -4
2. -13/9
3. -20/11
4. -11/5
5. -4/11

5) The demand curve for petroleum (oil refinery) should be

1. perfect inelastic in the short run
2. more or less elastic depending upon supply conditions
3. less elastic in the long run than in the short run
4. more elastic in the long run than in the short run
5. elastic in the long run as it is in the short run

1) A shift of the production possibilities curve outward could imply that

1. productivity has decreased at an increasing rate
2. society has chosen a different set of outputs.
3. the labor productivity has grown
4. productivity has declined because workers are demanding more leisure
5. an increase in inflation expectation

2) When price is $5 per unit, quantity demanded is 12 units. When price is $8 per unit, quantity demanded is 6 units. The value of the price elasticity of demand is approximately (before taking absolute value)

1. -4
2. -13/9
3. -20/11
4. -11/5
5. -4/11

3) When the price of silver rises, there will be

1. no change in quantity demanded
2. supply and demand will interact accordingly
3. a movement along the good's supply curve
4. both an outward shift in the demand for the good and a movement along the good's demand curve
5. an outward shift in the demand for the good

4) If goods X and Y are substitutes, then the cross elasticity of demand will be

1. positive
2. negative
3. zero
4. greater than 1
5. greater than zero but less than 1

5) When income is $100 per week, 10 units of good X are demanded. When income is $150 per week, 15 units of good X are demanded. The income elasticity of demand of good X equals to

1. 11/5
2. 5/11
3. 1
4. 10/15
5. 100/150