1. The law of demand states that:
a) There is a direct or positive relationship between the price of a commodity and the quantity demanded.
b) The quantity demanded will be higher the lower is its price.
c) The quantity demanded will be lower the lower is its price.
d) The quantity demanded will be higher the higher is its price.
2. The law of supply states that:
a) There is a direct or positive relationship between the quantity supplied of a good or service and its price.
b) The higher the price of a good and service, the lower the amount supplied.
c) The lower the price of a good or service, the more quantity is supplied.
d) Supply is higher than demand at the equilibrium price.
3. The quantity demanded of Pepsi has decreased. The best explanation for this is that:
a) The price of Pepsi increased.
b) Pepsi consumers had an increase in income.
c) Pepsi's advertising is not as effective as in the past.
d) The price of Coca Cola has increased.
4. Market equilibrium exists when _____________ at the prevailing price.
a) quantity demanded is less than quantity supplied
b) quantity supplied is greater than quantity demanded
c) quantity demanded equals quantity supplied
d) quantity demanded is greater than quantity supplied
5. A movement along the demand curve to the left may be caused by:
a) A decrease in supply.
b) A rise in the price of inputs.
c) A fall in the number of substitute goods.
d) A rise in income.
6. Injections of money:
a) Decrease aggregate demand
b) Always equal savings
c) Always equal national income
d) Include investment and export spending
7. An increase in national income is:
a) Likely to increase exports
b) Likely to decrease savings
c) Likely to decrease investment
d) Likely to increase spending on imports
8. An increase in national income is likely to:
a) Decrease tax receipts
b) Worsen the trade position
c) Automatically cause an increase in government spending
d) Cause an increase in injections into the economy
9. A significant increase in the government budget deficit is likely to:
a) Reduce injections into the economy
b) Reduce national income
c) Move the economy away from full employment
d) Boost aggregate demand
10. If injections of money are greater than withdrawals:
a) National income is likely to increase
b) National income is likely to decrease
c) National income will stay in equilibrium
d) Prices will fall
11. In the circular flow of income model injections:
a) Are assumed to be exogeneous (independent of national income)
b) Are assumed to be a function of national income
c) Decrease aggregate demand
d) Decrease the investment into an economy
12. For equilibrium in an open four sector economy:
a) Actual injections = actual withdrawals
b) Planned injections = planned withdrawals
c) Savings = investment
d) Government spending = tax revenue
13. A reflationary (expansionist) policy:
a) Increases aggregate supply
b) Increases aggregate demand
c) Decreases the price level
d) Increases full employment
14. A reflationary policy could include:
a) decreasing injections
b) increasing taxation rates
c) increasing interest rates
d) increasing government spending
15. Which of the following is an injection into the economy?
a) Investment
b) Savings
c) Taxation
d) Import spending
16. Which of the following is a characteristic of a perfectly competitive market?
a) Firms are price setters.
b) There are few sellers in the market.
c) Firms can exit and enter the market freely.
d) All of these
17. Which of the following is NOT a feature of monopolistic competition?
a) Numerous sellers
b) Product differentiation
c) Numerous buyers
d) Homogenous products
18. In which form of market structure would price be the key factor when competing?
a) Monopoly
b) Oligopoly
c) Monopolistic Competition
d) Perfect Competition
19. When the market is run by a small number of firms that together control the majority of market share is known as
a) Oligopoly
b) Duopoly
c) Oligopsony
d) Perfect Competition
20. “Image building” objectives are common in _____ type of market structure?
a) Perfect Competition
b) Oligopoly
c) Monopsony
d) Monopoly
In: Economics
Choose a product which you are familiar with. Using the internet
for research (please cite your source), what is the price
elasticity of demand for this product or group of products? What
does that mean with respect to a 10% increase in the price of this
good? What happens to quantity demanded?
Which of the 4 determinants of price elasticity of demand do you
believe drives this outcome about the good's price elasticity? If
there is more than one determining factor, please explain your
reasoning. [for many goods, all of the 4 determinants come into
play - I just want you to choose the one or two that you believe
are most relevant).
In: Economics
As a physics demonstration, you want a special bowling ball made to demonstrate exactly 1 kg·m2, so that your students can rotate the ball about its center of mass to get a "feel" for how "big" 1 kg·m2 is. The bowling balls most familiar to your students has a weight of 15.4 pounds and have a circumference of 25.5 inches, but do not have a moment-of-inertia equal to 1 kg·m2. Since the sporting goods manufacturer has no understanding of how \"big\" 1 kg·m2 is, calculate the diameter of the demo bowling ball (in inches) it will need to manufacture. Assume that bowling balls are solid, with a constant density.
In: Physics
|
Knockoffs Unlimited, a nationwide distributor of low-cost imitation designer necklaces, has an exclusive franchise on the distribution of the necklaces, and sales have grown so rapidly over the past few years that it has become necessary to add new members to the management team. To date, the company’s budgeting practices have been inferior, and, at times, the company has experienced a cash shortage. You have been given responsibility for all planning and budgeting. Your first assignment is to prepare a master budget for the next three months, starting April 1. You are anxious to make a favourable impression on the president and have assembled the information below. |
| The necklaces are sold to retailers for $10 each. Recent and forecasted sales in units are as follows: |
| January (actual) | 23,000 | June | 56,000 |
| February (actual) | 32,000 | July | 36,000 |
| March (actual) | 45,000 | August | 34,000 |
| April | 71,000 | September | 31,000 |
| May | 105,000 | ||
|
The large buildup in sales before and during May is due to Mother’s Day. Ending inventories should be equal to 40% of the next month’s sales in units. |
|
The necklaces cost the company $4 each. Purchases are paid for as follows: 50% in the month of purchase and the remaining 50% in the following month. All sales are on credit, with no discount, and payable within 15 days. The company has found, however, that only 20% of a month’s sales are collected by month-end. An additional 70% is collected in the following month, and the remaining 10% is collected in the second month following sale. Bad debts have been negligible. |
| The company’s monthly selling and administrative expenses are given below: |
| Variable: | |||
| Sales commissions | 4 | % of sales | |
| Fixed: | |||
| Advertising | $ | 218,000 | |
| Rent | 21,000 | ||
| Wages and salaries | 113,200 | ||
| Utilities | 9,400 | ||
| Insurance | 4,200 | ||
| Depreciation | 20,000 | ||
|
All selling and administrative expenses are paid during the month, in cash, with the exception of depreciation and insurance. Insurance is paid on an annual basis, in November of each year. The company plans to purchase $18,400 in new equipment during May and $46,000 in new equipment during June; both purchases will be paid in cash. The company declares dividends of $16,200 each quarter, payable in the first month of the following quarter. The company’s balance sheet at March 31 is given below: |
| Assets | |||
| Cash | $ | 80,000 | |
| Accounts receivable
($32,000 February sales; $360,000 March sales) |
392,000 | ||
| Inventory | 113,600 | ||
| Prepaid insurance | 29,400 | ||
| Fixed assets, net of depreciation | 980,000 | ||
| Total assets | $ | 1,595,000 | |
| Liabilities and Shareholders’ Equity | |||
| Accounts payable | $ | 110,800 | |
| Dividends payable | 16,200 | ||
| Common shares | 860,000 | ||
| Retained earnings | 608,000 | ||
| Total liabilities and shareholders’ equity | $ | 1,595,000 | |
|
The company wants a minimum ending cash balance each month of $50,000. All borrowing is done at the beginning of the month, with any repayments made at the end of the month. The interest rate on these loans is 1% per month and must be paid at the end of each month based on the outstanding loan balance for that month. |
| a) Sales Budget | ||||
| April | May | June | Quarter | |
| Budgeted Unit Sales | 71,000 | 105,000 | 56,000 | 232,000 |
| Selling Price per unit | $10 | $10 | $10 | $10 |
| Total Sales | $710,000 | $1,050,000 | $560,000 | $2,320,000 |
| b) | ||||
| 1b. A schedule of expected cash collections from sales, by month and in total | ||||
| April | May | June | ,Quarter | |
| February sales = 32000 x $10 x 10% | $32,000 | $32,000 | ||
| March sales = 45,200 x $10 x 70%; 45200 x $10 x 10% | $315,000 | $45,000 | $360,000 | |
| April sales 71000 x 10 x 20%; 70% ;10% | $142,000 | $497,000 | $71,000 | $710,000 |
| May sales 105,000 x 10 x 20%;70% ; | $210,000 | $735,000 | $945,000 | |
| June sales 56,000 x $10 x 10% | $56,000 | $56,000 | ||
| Total Cash Sales | $489,000 | $752,000 | $862,000 | $2,103,000 |
| 1c. A merchandise purchases budget in units and in dollars. Show the budget by month and in toal | ||||
| April | May | June | Quarter | |
| Budgeted unit sales | 71,000 | 105,000 | 56,000 | 232,000 |
| Add: Desired Ending Inventory 40% x (may , june, july rspectively) | 42,000 | 22,400 | 14,400 | 14,400 |
| Total needs | 113,000 | 127,400 | 70,400 | 310,800 |
| Less: Brginning Inventory | 28,400 | 42,000 | 22,400 | 28,400 |
| Required purchases | 84,600 | 85,400 | 48,000 | 218,000 |
| Unit Cost | $4 | $4 | $4 | $4 |
| Required $ purchases | $338,400 | $341,600 | $192,000 | $872,000 |
| 1d. A schedule of expected cash dibursements for merchandise purchases, by month in total | ||||
| April | May | June | Quarter | |
| Accts. payable | $110,800 | $110,800 | ||
| April purchases | $169,200 | $169,200 | $338,400 | |
| May purchases | $170,800 | $170,800 | $341,600 | |
| June purchases | $96,000 | $96,000 | ||
| Total cash payments | $280,000 | $169,200 | $170,800 | $886,800 |
required:
| 2. |
a. A cash budget. Show the budget by month and in total. (Round your intermediate calculations and final answers to the nearest whole dollar. Also, round down your interest calculations to the next whole dollar amount. Cash deficiency, repayments and interest should be indicated by a minus sign.) |
| b. |
A budgeted income statement for the three-month period ending June 30. Use the variable costing approach. |
| c. | A budgeted balance sheet as of June 30. |
In: Accounting
I want to quadruple my money in 10 years. If I earn 4.427% each quarter, how many years will it take for me to achieve that objective?
In: Finance
(Unique, No Handwriting)
Explain why Alphabet Inc. Company is considered to have outperformed its expectations in the second quarter of 2018. (No more than 250 words.)
In: Finance
Research the following question using the Federal Reserve's Beige Book Summary for the latest quarter: is our economy in the recession or growth/expansion phase of the business cycle?
In: Economics
Short Answer - Millie
Must Include Supporting Documentation in File Upload portion of
exam. Please label page as "Millie."
On January 1, 2019, Millie Manufacturing leased a building for use in its operations from Dallas Realty. The 7-year, noncancellable lease requires annual lease payments of $22,000, beginning January 1, 2019, and at each January 1 thereafter through 2025.
The lease payments include payments for common area maintenance. The observable standalone lease price for the building is $20,000 and the observable standalone price for the common area maintenance is $5,000. Millie elects to account for each lease component and associated non-lease components separately using the proportionate method.
The lease agreement does not transfer ownership, nor does it contain a purchase option, and has no guaranteed residual value. The building has a fair value of $95,000 and an estimated remaining life of 8 years. Dallas Realty's implicit rate of 10% is known to Millie.
Required for Millie (Lessee) - round all final answers to nearest whole dollar.
a. How should Millie classify the lease?
b. At what value should Millie record the right-of-use asset in the
initial lease measurement (before the first payment is made)?
In your supporting documentation, show the appropriate journal
entry to support your answer in part (b.) Also show all of the
inputs used in your PV calculation.
c. How much interest expense and amortization expense should
Millie show on her December 31, 2019 income statement?
Interest expense: $
Amortization expense: $
d. What is the carrying value of the ROU Asset on Millie's December 31, 2019 balance sheet?
In: Accounting
Magpie Ltd enters into a non-cancellable two-year lease agreement with Tiger Ltd for an item of machinery on 1 January 2020. Magpie Ltd pays $15,000 on signing the agreement with Tiger Ltd on 1 January 2020. There are eight quarter payments of $10,000, the first being made on 31 March 2020. Included within the $10,000 lease payments is an amount of $1,000 representing payment to the lessor for insurance and maintenance of the machinery. The machinery is to be depreciated on a straight-line basis. The machinery is expected to have an economic life of five years, after which time it will have a zero-salvage value. There is a purchase option Magpie Ltd will be able to exercise at the end of the second year for $30,000. If this purchase option is exercised, the machinery will be transferred to Magpie Ltd. The rate of interest implicit in the lease is 12%. Refer to the appendix for the tables of Present Value Factor for a single future amount and Present Value of an ordinary annuity of $1
Calculate the lease liability and lease asset.
In: Finance
The management estimates total sales for the period January through
June based on
actual sales from the immediate past six months. The following
assumptions are made:
1. The Sales were $150,000 in January 2018 and then the sales grew
by 10% each
month for the first five months (February to June). The sales are
expected to grow
by 5% each month thereafter.
2. 50% of the Sales are collected in the same month. 45% of the
sales are collected
in the following month and remainder are not collected.
3. The Purchases are 20% of sales and paid in the same month.
4. Wages and Salaries are $10,000 each month and paid in the same
month.
5. Depreciation expense is $5,000 each month.
6. An equipment worth $100,000 will be purchased with cash in
October.
7. The company’s debt is $50,000 and the company pays coupon
payments in June
and December of each year. The coupon rate is 10% per year.
8. Rent Expenses will be $5000 and will be paid at the end of each
calendar quarter
In: Finance