Demand for hotel rooms in Tallahassee takes two possible values: on game days, demand is described by the demand curve q = 100−p, while on non-game-days demand is described by the demand curve q = 60 − 2p.

(a) Suppose that the hotel price on game days is ph = 80. What quantity is demanded at this price?

(b) Find the inverse demand curve on non-game-days. Assuming that the price on game days is ph = 80 as above, what price would induce the same quantity demanded on non-game-days as on game days?

(c) Plot the demand curves on game days and on non-game-days. Pay careful attention to the price and quantity intercepts for both curves.

(d) Assuming the price on non-game-days is as you found in (ii), what is consumer surplus in this market on non-game-days? What is consumer surplus on game days?

(e) Suppose that you encounter the following claim: “Because the hotel price is higher on game days than on non-game-days, consumer surplus in the hotel market must be lower on game days.” What is wrong with this claim?

a) In order to determine the average price of hotel rooms in Atlanta, a sample of 61 hotels were selected. It was determined that the average price of the rooms in the sample was $111.9. The population standard deviation is known to be $19. We would like to test whether or not the average room price is significantly different from $110.

Compute the test statistic.

b) In order to determine the average price of hotel rooms in Atlanta, a sample of 61 hotels were selected. It was determined that the test statistic (z) was $-1.01. We would like to test whether or not the average room price is significantly different from $110. Population standard deviation is known to us.

Compute the p-value.

c) In order to determine the average price of hotel rooms in Atlanta. Using a 0.1 level of significance, we would like to test whether or not the average room price is significantly different from $110. The population standard deviation is known to be $16. A sample of 64 hotels was selected. The test statistic (z) is calculated and it is -1.8.

We conclude that the average price of hotel rooms in Atlanta is NOT significantly different from $110. (Enter 1 if the conclusion is correct. Enter 0 if the conclusion is wrong.)

You are the financial manager of Walnut Grove City, a small mid-eastern town, and in charge of creating a capital budget for the next year. The only project on the agenda is building a clock tower within the city square and expanding the adjacent park for small events. You must incorporate into the budget the expense of building a clock tower in the city's town square and adjacent park, and may choose the size, exact location and materials to be used. The expense for the clock tower is estimated to be $400,000 and clean-up of the adjacent park is estimated to be $50,000. After the expansion, three events are planned: 1. Street party celebrating the new clock tower and park which will continue as an anniversary party every year thereafter, and is expected to have a net income of $75,000; 2. Fourth of July fireworks celebration with expected net income of $125,000; and 3. Labor Day carnival to celebrate going back to school and harvest which is expected to have a net income of $50,000. All three events will be continued each following year.

Explain the five capital budgeting steps you will use and how each step will be associated with the clock tower project.

E14-23

Weyden Hotel​ & Casino is situated on beautiful Lake Tahoe in Nevada. The complex includes a​ 300-room hotel, a​ casino, and a restaurant. As Weyden​'s new​ controller, your manager asks you to recommend the basis the hotel should use for allocating fixed overhead costs to the three divisions in 2017. You are presented with the following income statement information for 2016​:

You are also given the following data on the three divisions.

You are told that you may choose to allocate indirect costs based on one of the​ following: direct​ costs, floor​ space, or the number of employees. Total fixed overhead costs for 2016 were $14,630,000.

QUESTION 12

Assume that a firm's marginal revenue barely exceeds marginal cost. To maximize profit, teh firm should:

QUESTION 13

In the short run, a perfectly competitive firm will stay in business as long as:

QUESTION 14

Suppose that price is below the minimum average total cost (ATC) but above the minimum average variable cost (AVC), and the market price is expected to rise at least to ATC in the near future. In the short run, a firm that is a price taker would:

QUESTION 15

Where is the "short-run shut down point" for a perfectly competitive firm?

Buckeye Department Stores, Inc. operates a chain of department stores in Ohio. The company’s organization chart appears below. Operating data for 20x1 follow.

The following fixed expenses are controllable at the divisional level: depreciation—furnishings, computing and billing, warehouse, insurance, and security. In addition to these expenses, each division annually incurs $60,000 of computing costs, which are not allocated to individual stores.

The following fixed expenses are controllable only at the company level: depreciation—building, property taxes, and supervisory salaries. In addition to these expenses, each division incurs costs for supervisory salaries of $110,000, which are not allocated to individual stores.

Buckeye Department Stores incurs common fixed expenses of $130,000, which are not allocated to the two divisions. Income-tax expense for 20x1 is $2,050,000.

Required:

1. Prepare a segmented income statement for Buckeye Department Stores, Inc. Please fill in the chart I provided below, thank you!

Prepare a segmented income statement for Buckeye Department Stores, Inc. (Enter your answers in thousands.)

Sidneyland is a popular theme park in Southern California that is now planning for its eventual re-opening after closing during Covid-19. In years past, New Years Eve was the single largest day of revenue earned by the park due to the high sales volume of NYE themed merchandise. However, this year it is uncertain if Sidneyland will even be opened on New Years Eve, and the time to order the 2021 apparel is approaching. The first purchase deadline is at the end of October, at which point Sidneyland can either buy the goods in full for​$100,000 or defer the decision until the end of November. At the end of November, the rush order price rises to​$150,000​. There is ​no cost nor profit if no purchase is made​. Sidneyland’s public health and data science consultants estimate that there is a​40% chance that the local Covid-19 situation improves from the end of October to the end of November, a​60% ​chance that it stays in the current most restrictive tier. If it improves, the experts predict a​90% ​chance the park is open on NYE, compared to a ​30%​ chance if it stays in the current most restrictive tier. Assuming that all goods sell for ​$200,000 if the park is open on NYE but are otherwise unsellable, answer the following questions about Sidneyland’s purchasing strategy if their goal is to maximize expected merchandise profit.

A) What are all of the different times to make a decision, and what decisions can be made at those times? ​

B) Supposing that Sidneyland defers and waits to make a decision at the end of November and supposing further that the public health scenario improves from October to November, what strategy should they take and what is the resulting expected earnings (or losses)?

C) Using the projections from the end of October, what are the expected merchandise earnings (or losses) if Sidneyland elects to defer the decision from October to November? ​

D) Using the projections from the end of October, what are the expected merchandise earnings (or losses) if Sidneyland buys the merchandise at the end of October?

E) What decision should Sidneyland make at the end of October? Explain.

(b) During the year ended 30 June Year 6, Nungua Ltd acquired freehold land at a cost of
GHC 500,000 and built a distribution centre on it, using a mixture of subcontract and own
labour. The distribution centre cost a total of GHC 200,000 to construct. The construction was
completed by the end of April.

Required:

Set out the audit objectives in respect of the above and the substantive procedures you would
carry out to achieve those objectives.

Economic Forecasting. Assume you are a cartoon artist at a local theme park. At your current price, $8.50, you sell 500 sketches a month. As a result of a $1.00 price increase sales reduced by 100 sketches.

1. What is the demand elasticity of your sketches? Interpret your results.
2. Assume your marginal cost is $4. What is your desired margin and your current margin? Interpret these numbers.
3. Was your price strategy profitable? Why or why not?

A) Find the equation of the tangent line to the curve y = 5e^-8x at the point (0, 5).

B) Solve for t.

e^0.09t = 9

C) Rancher Johann wants to build a three-sided rectangular fence near a river, using 280 yards of fencing. Assume that the river runs straight and that Johann need not fence in the side next to the river.

Johann wants to build a fence so that the enclosed area is maximized.

• What should be the length of each side running perpendicular to the river?
  yards
  
• What should be the length of the side running parallel to the river?
  yards
  
• What is the largest total area that can be enclosed?
  square yards

D) Find the absolute maximum and minimum values on the closed interval [-3,3] for the function below. If a maximum or minimum value does not exist, enter NONE.

f(x) = (4x)/(x² + 1)

E) When a baseball park owner charges $5.00 for admission, there is an average attendance of 100 people. For every $0.25 increase in the admission price, there is a loss of 2 customers from the average number.

1. What admission price should be charged in order to maximize revenue
   
2. What is the maximum revenue?

F) Find the derivative.

f(x) = x⁶ · e^2x