For this problem, we will be working with an annual labor supply decision (rather than weekly). This means the person will have 5,000 hours available to spend on labor/leisure (50 weeks * 100 hours per week). We will explore the life and labor supply decisions of Sully. Sully is a single father of 2 that lives his life a quarter mile at a time. Suppose Sully can currently earn a wage of $10 per hour in the labor market. Because of his 2 beloved - though troubled - children, he is eligible to earn a tax credit (if he qualifies based on income level). The tax credit program for individuals with 2 kids has the following features: No credit is earned if no income is earned For annual earnings between 0 and $10,000, a 50% tax credit will be applied. This means, for example, an individual earning $1,000 in wage income would receive $500 in tax credit/refund (we can think of this as additional income). For annual earnings between $10,000 and $20,000, the individual keeps the tax credit earned (there is no payback in this range). For annual earnings over $20,000, the individual will begin to payback his or her tax credit at a rate of 20% (every $1 earned beyond $20,000 means paying back $0.20 worth of credit).

1. (2 points) Complete the following table by filling out earned income, tax credit earned, and total amount of spending money at each level of work hours. Determine the amount of hours/earned income where Sully will no longer qualify for any tax credit (he has paid it all back). Use this information to find his effective hourly wage (net wage) at different levels of work.

2. Hours Worked (annual)	Earned Income	Amount of Tax Credit earned	Total Spending Money	Effective hourly wage
   0	0	0	0	--
   500
   501
   1000
   1001
   2000
   2001
   		0
   5000

3. B (4 points) Create a sketch of Sully’s annual labor supply decision by showing the budget constraint with and without the tax credit program. Assume he has no non-labor income. Be sure to label consumption and leisure at any critical points on the budget constraint. Draw an indifference curve showing what you think is a reasonable choice, and label consumption and leisure at this point. Discuss how the income tax credit’s impact on net wages might impact Sully’s labor supply decision.

As of 2010, Xerox Corporation (NYSE: XRX) is a $22 billion, multinational company founded in 1906 and operating in 160 countries. Xerox is headquartered in Norwalk, Connecticut, and employs 130,000 people. Such companies depend on the productivity and performance of their employees. The journey over the last 100 years has withstood many successes and failures. In 2000, Xerox was facing bankruptcy after years of mismanagement, piles of debt, and mounting questions about its accounting practices. How does a company of such size and magnitude effectively manage and motivate employees from diverse backgrounds and experiences especially during a crisis?

500 words typed

1. Long-run real interest rates are expected to increase. An accountant and an MBA student (who just finished his course of Managerial Economics) were interviewed regarding the effect of this increase. Keeping all else constant, their answer would likely differ. How do you guess the interviewed will answer? Does the difference in response matters? If yes, why? If not, why not? (20 points)

2. Many cities have experienced a substantial decrease in the amount of garbage being collected after they changed from levying a flat tax on each household to a system where the homeowner is charged a fee for each bag or can picked up. Would this have been the result of a change in demand or a change in the quantity demanded? Would you recommend the flat fee or the fee per bag? Why? (20 points)

3. Define three types of elasticity of demand. Indicate how you would use information from recent research paid by your company that the own price elasticity of your product is -1.2 and not -0.8 as previously thought. (20 points)

4. A magazine, in an article dealing with management, wrote, “When he took over the furniture factory three years ago … [the manager] realized almost immediately that it was throwing away at least $100,000 a year worth of wood scrap. Within a few weeks, he set up a task force of managers and workers to deal with the problem. And within a few months, they reduced the amount of scrap to $7,000 worth [per year].” Was this necessarily an economically efficient move? Explain your answer. (20 points)

5. If all the assumptions of perfect competition hold, why would firms in such an industry have little incentive to carry out technological change or much research and development? What conditions would encourage research and development in any of the competitive industries? (20 points)

Determine the individuals who will be administered the survey. Randomly select a number from 1 to k. Suppose that we randomly select 6. Starting with the first individual​ selected, the individuals in the survey will be nothing​, nothing​, nothing​..., nothing.

Assume today is March 16, 2016. Natasha Kingery is 30 years old and has a Bachelor of Science degree in computer science.
She is currently employed as a Tier 2 field service representative for a telephony corporation located in Seattle,
Washington, and earns $38,000 a year that she anticipates will grow at 3% per year. Natasha hopes to retire at age 65 and
has just begun to think about the future.
Natasha has $75,000 that she recently inherited from her aunt. She invested this money in 30-year Treasury Bonds. She is
considering whether she should further her education and would use her inheritance to pay for it.
She has investigated a couple of options and is asking for your help as a financial planning intern to determine the financial
consequences associated with each option. Natasha has already been accepted to both of these programs, and could start
either one soon.
One alternative that Natasha is considering is attaining a certification in network design. This certification would
automatically promote her to a Tier 3 field service representative in her company. The base salary for a Tier 3
representative is $10,000 more than what she currently earns and she anticipates that this salary differential will grow at a
rate of 3% a year as long as she keeps working. The certification program requires the completion of 20 Web- based courses
and a score of 80% or better on an exam at the end of the course work. She has learned that the average amount of time
necessary to finish the program is one year. The total cost of the program is $5000, due when she enrolls in the program.
Because she will do all the work for the certification on her own time, Natasha does not expect to lose any income during
the certification.
Another option is going back to school for an MBA degree. With an MBA degree, Natasha expects to be promoted to a
managerial position in her current firm. The managerial position pays $20,000 a year more than her current position. She
expects that this salary differential will also grow at a rate of 3% per year for as long as she keeps working. The evening
program, which will take three years to complete, costs $25,000 per year, due at the beginning of each of her three years in
school. Because she will attend classes in the evening, Natasha doesn’t expect to lose any income while she is earning her
MBA if she chooses to undertake the MBA.
1. Determine the interest rate she is currently earning on her inheritance by going to Yahoo! Finance
(http://finance.yahoo.com) and typing the word “Treasury” in the search field and picking the 30 year yield
(ticker: ^TYX) off the dynamic menu that appears. Then go to “Historical Prices” (located in the left column) and
enter the appropriate date, March 16, 2016 to obtain the closing yield or interest rate that she is earning. Use this
interest rate as the discount rate for the remainder of this problem.
2. Create a timeline in Excel for her current situation, as well as the certification program and MBA degree options,
using the following assumptions:
Salaries for the year are paid only once, at the end of the year.
The salary increase becomes effective immediately upon graduating from the MBA program or being certified.
That is, because the increases become effective immediately but salaries are paid at the end of the year, the first
salary increase will be paid exactly one year after graduation or certification.
3. Calculate the present value of the salary differential for completing the certification program. Subtract the cost of
the program to get the NPV of undertaking the certification program.
4. Calculate the present value of the salary differential for completing the MBA degree. Calculate the present value of
the cost of the MBA program. Based on your calculations, determine the NPV of undertaking the MBA.
5. Based on your answers to Questions 3 and 4, what advice would you give to Natasha? What if the two programs
are mutually exclusive? That is, if Natasha undertakes one of the programs there is no further benefit to
undertaking the other program. Would your advice be different?

Assume today is March 16, 2016. Natasha Kingery is 30 years old and has a Bachelor of Science degree in computer science. She is currently employed as a Tier 2 field service representative for a telephony corporation located in Seattle, Washington, and earns $38,000 a year that she anticipates will grow at 3% per year. Natasha hopes to retire at age 65 and has just begun to think about the future.

Natasha has $75,000 that she recently inherited from her aunt. She invested this money in 30-year Treasury Bonds. She is considering whether she should further her education and would use her inheritance to pay for it.9

She has investigated a couple of options and is asking for your help as a financial planning intern to determine the financial consequences associated with each option. Natasha has already been accepted to both of these programs, and could start either one soon.

One alternative that Natasha is considering is attaining a certification in network design. This certification would automatically promote her to a Tier 3 field service representative in her company. The base salary for a Tier 3 representative is $10,000 more than what she currently earns and she anticipates that this salary differential will grow at a rate of 3% a year as long as she keeps working. The certification program requires the completion of 20 Web-based courses and a score of 80% or better at the end of the course work. She has learned that the average amount of time necessary to finish the program is one year. The total cost of the program is $5000, due when she enrolls in the program. Because she will do all the work for the certification on her own time, Natasha does not expect to lose any income during the certification.

Another option is going back to school for an MBA degree. With an MBA degree, Natasha expects to be promoted to a managerial position in her current firm. The managerial position pays $20,000 a year more than her current position. She expects that this salary differential will also grow at a rate of 3% per year for as long as she keeps working. The evening program, which will take three years to complete, costs $25,000 per year, due at the beginning of each of her three years in school. Because she will attend classes in the evening, Natasha doesn’t expect to lose any income while she is earning her MBA if she chooses to undertake the MBA.

1. Determine the interest rate she is currently earning on her inheritance by going to the U.S. Treasury Department Web site (treasury.gov) and selecting “Data” on the main menu. Then select “Daily Treasury Yiled Curve Rates” under the Interest Rate heading and enter the appropriate year, 2016, and then search down the list for March 16 to obtain the closing yield or interest rate that she is earning. Use this interest rate as the discount rate for the remainder of this problem.

2. Create a timeline in Excel for her current situation, as well as the certification program and MBA degree options, using the following assumptions:

   • Salaries for the year are paid only once, at the end of the year.

   • The salary increase becomes effective immediately upon graduating from the MBA program or being certified. That is, because the increases become effective immediately but salaries are paid at the end of the year, the first salary increase will be paid exactly one year after graduation or certification.

3. Calculate the present value of the salary differential for completing the certification program. Subtract the cost of the program to get the NPV of undertaking the certification program.

4. Calculate the present value of the salary differential for completing the MBA degree. Calculate the present value of the cost of the MBA program. Based on your calculations, determine the NPV of undertaking the MBA.

5. Based on your answers to Questions 3 and 4, what advice would you give to Natasha? What if the two programs are mutually exclusive? That is, if Natasha undertakes one of the programs there is no further benefit to undertaking the other program. Would your advice be different?

Revenues are normally recognized when the company transfers promised goods or services in the amount the company expects to receive. The amount recorded is the cash-equivalent sales price. The following transactions occurred in September:

1. A popular ski magazine company receives a total of $13,345 today from subscribers. The subscriptions begin in the next fiscal year. Answer from the magazine company's standpoint.
2. On September 1 of the current year, a bank lends $2,500 to a company; the note principal and $300 ($2,500 × 12 percent) annual interest are due in one year. Answer from the bank's standpoint.
3. Fucillo Automotive Group (offering a wide variety of car and truck brands) sells a Ford F-150 truck with a list, or “sticker,” price of $21,750 for $19,750 cash.
4. Macy's department store orders 1,140 men’s shirts for $17 each for future delivery from PVH Corp., manufacturer of IZOD, ARROW, Van Heusen, Calvin Klein, and Tommy Hilfiger apparel. The terms require payment in full within 30 days of delivery. Answer from PVH Corp.'s standpoint.
5. PVH Corp. completes production of the shirts described in (d) and delivers the order. Answer from PVH's standpoint.
6. PVH Corp. receives payment from Macy's for the events described in (d) and (e). Answer from PVH's standpoint.
7. A customer purchases a ticket from American Airlines for $650 cash to travel the following January. Answer from American Airlines's standpoint.
8. Ford Motor Company issues $20.9 million in new common stock.
9. Michigan State University receives $19,030,000 cash for 73,000 five-game season football tickets.
10. Michigan State plays the first football game referred to in (i).
11. Precision Builders signs a contract with a customer for the construction of a new $1,670,000 warehouse. At the signing, Precision receives a check for $194,000 as a deposit on the future construction. Answer from Precision's standpoint.
12. A customer orders and receives 16 personal computers from Dell; the customer promises to pay $9,300 within three months. Answer from Dell's standpoint.
13. Sears, a retail store, sells a $260 lamp to a customer who charges the sale on his Sear's credit card. Answer from Sears's standpoint.

Required:

For each of the transactions, if revenue is to be recognized in September, indicate the revenue account title and amount. (If revenue is not recognized choose "None". Round "Interest revenue" answer to 2 decimal places.)

Revenue Account Affected Amount of revenue earned in September

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

11.

12.

13.

As discovered in previous research, the premium pet industry was not impacted from the recession and continues to grow. You have been approached by an individual who wants to open up a pet food delivery service. Customers will either call an 800 number or go online and place orders for pet foods. The pet foods will then be delivered to the home within 24 hours of the order placement. For an additional fee, the delivery person will place the purchased product in the home and, if necessary, will put the food into a receptacle for the pet owner.

The person wants to open up the business in the greater Tampa/St. Petersburg area. However, the person is uncertain as to the type of person they should consider approaching as customers. They do not know who their target market is.

Reflecting on the above from a Marketing Strategy Perspective, address the following issues:

Question:

Develop a customer retention program for this business. Discuss the concept of customer orientation and the importance of a customer retention program and what factors should be considered for this business. Identify the type of information the company needs to design this program and from where the company will obtain this information.