1. For the following total revenue and total cost functions of a firm:
   TR = 802.5Q – 10Q²
   TC = (2/3)Q³ -30Q² + 672Q +4000
   

1. Determine the level of output at which the firm maximizes total profit
2. Calculate the profit
   (20 points)

• Reference problem on pp. 104-106 and graphs on p. 77.

1. Solution writes a total profit equation (TR equation minus the TC equation and simplify) and takes its derivative to get a marginal profit equation.
2. If you set the marginal profit or derivative equation equal to zero you find the points where the rate of change is zero; i.e., the peak or trough (see diagram of profit function in text).
3. To solve it you will probably want to use the Quadratic Formula. If you are unfamiliar with the Quadratic see http://www.purplemath.com/modules/quadform.htm
4. The quadratic formula gives two values of Q for which the marginal profit is zero. In the text example, they take the second derivative (the derivative of the marginal profit function) and plug in each quantity. If the 2^nd derivative is negative you have reached a peak, if negative, a trough. You can take the 2^nd derivative if you prefer but for the functions you will encounter in this course, the answer is ALWAYS THE LARGER ONE. Note that on the total profit graph (p. 77) there is both a peak and a trough. The peak occurs at the larger quantity.

Overview: For this task, you will explain the importance of cost of capital to organizational success and work through some calculations to understand their value. Prompt: First, review the module resources, especially Chapter 11 in the textbook. Then, address the following:

Answer the following questions based on your organization chosen for the final project. AMAZON INC

Write your response in a separate Microsoft Word document:

o Importance of Cost of Capital: Why is cost of capital important to an organization, and what does it measure?

o Meaning of Calculations: How do organizations calculate various costs, and what do these calculations mean to business?

explain why proper cost allocation is important to health services organizations

Prepare journal entries for the following transactions: a. A machine that cost $10,000 with a residual value of $2,000 is fully depreciated and discarded. b. A machine purchased on January 1, 2020 for $20,000, with a useful life of 4 years, and a residual value of $4,000, is sold on April 1, 2020 for $8,000. Use the straight-line method. c. A machine that cost $15,000, has accumulated depreciation of $12,000 is sold for $5,000.

Every decision has an Opportunity Cost due to the nature of scarcity, there is always a better alternative not chosen, therefore, there is always an opportunity cost. “The opportunity cost of an alternative is what you give up to pursue it” (Froeb, McCann,Shor & Ward, 2016). When you go to a Maroon 5 concert, you give up $100 of benefits you would have received if you had gone to a Beyoncé concert. Also, you would also avoid $80 of cost for the Beyoncé concert. According to the definition below, the opportunity cost of seeing Maroon 5 concert is $100 - $80 = $20. Please delve into the statement there are always opportunity costs. How can an individual make the best decision? Is there a best decision? Would one miss an opportunity not attending one of the concerts? Include a minimum of one reference.

Assume that IBM leased equipment that was carried at a cost of $120,000 to Sharon Swander Company. The term of the lease is 6 years beginning January 1, 2020, with equal rental payments of $28,430 at the beginning of each year. All executory costs are paid by Swander directly to third parties. The fair value of the equipment at the inception of the lease is $145,000. The equipment has a useful life of 6 years with no residual value. The lease has an implicit interest rate of 7%, no bargain-purchase option, and no transfer of title. Collectibility is reasonably assured with no additional cost to be incurred by IBM.

The present value of an annuity due, 6 years, 7% is 5.10020

Oriole Co. is building a new hockey arena at a cost of $2,420,000. It received a downpayment of $510,000 from local businesses to support the project, and now needs to borrow $1,910,000 to complete the project. It therefore decides to issue $1,910,000 of 10%, 10-year bonds. These bonds were issued on January 1, 2019, and pay interest annually on each January 1. The bonds yield 9%.

1. Prepare the journal entry to record the issuance of the bonds on January 1, 2019. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to 0 decimal places e.g. 58,971. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

2. Prepare a bond amortization schedule up to and including January 1, 2023, using the effective interest method. (Round answers to 0 decimal places, e.g. 38,548.)

3. Assume that on July 1, 2022, Oriole Co. redeems half of the bonds at a cost of $1,040,600 plus accrued interest. Prepare the journal entry to record this redemption.

Assume there are 5 companies with the following pollution (in tons) and constant marginal cost of reduction MCR (in $/ton)

A (pollution 60, MCR 1)

B (pollution 90, MCR 2)

C (pollution 30, MCR 4)

D (pollution 60, MCR 3)

E (pollution 120, MCR 5)

if permits can be trade, who sells permits?

- A and C

- B and C

- A and B

- A

- B

- none of the above

7. An investment has a cost of $2000. The investment will have a payout of X at the end of the first year. This initial payout X will grow at the rate of 10% per year for the next 3 years, then by 6% per year for the next 2 years, and then at the rate of 4% per year for the following 1 year. You believe the riskiness of this investment is 9%.

a. Calculate the smallest X that would entice you to invest.