Given the following marginal utility schedule for good X and good Y for an individual A, given that the price of X and the price of Y are both $10, and that the individual spends all his income of $70 on X and Y,

Q x          1         2       3      4      5      6        7
MUX      15       11       9      6      4      3        1
Q y           6        5       4      3      2      1        0
MUY       12        9       8      6      5      2        1

1. Provide the slope of the budget line
2. Estimate the MRS at the optimum

3. Indicate how much of X and Y the individual should purchase to maximize utility.
Select one:
a. 1. Provide the slope of the budget line: -10
2. Estimate the MRS at the optimum: -10

3. Indicate how much of X and Y the individual should purchase to maximize utility. 4X and 3Y
b. 1. Provide the slope of the budget line: -1
2. Estimate the MRS at the optimum:-1

3. Indicate how much of X and Y the individual should purchase to maximize utility: 6X and 6Y
c. 1. Provide the slope of the budget line: -10/70
2. Estimate the MRS at the optimum: -10/70

3. Indicate how much of X and Y the individual should purchase to maximize utility. 1X and 6Y
d. 1. Provide the slope of the budget line: -1
2. Estimate the MRS at the optimum: -1

3. Indicate how much of X and Y the individual should purchase to maximize utility. 7X and 0Y
e. 1. Provide the slope of the budget line: -1
2. Estimate the MRS at the optimum: -1

3. Indicate how much of X and Y the individual should purchase to maximize utility: 4X and 3Y

1.When students apply for graduate studies (i.e. at the master’s or doctoral level), they are
required to submit an official copy of their transcript, mailed directly from the Registrar’s
Office at their academic institution. The customer service division of the Registrar’s
Office at a large Canadian university is interested in determining if they are more than
25% faster at processing transcripts than another university in the area, which can process
transcripts in 16 business hours. The customer service manager obtains a random sample
of 10 waiting times (in business hours), which are provided below.
11 12 18 20 23
15 10 12 13 14
a. Conduct an appropriate hypothesis test. Use the critical value method. Use a
population standard deviation of 2 hours. [9 marks]
HINT: You will first have to determine what it means to be 25% faster, in terms
of hours.
b. Explain what a Type I Error means in this context. [1 mark]   
2. A major keyboard manufacturer has a line of keyboards designed for apartment dwellers.
These keyboards need to be light enough to be carried up flights of stairs. The lead
engineer wants to use a new type of material. The engineer claims that the new keyboards
will be lighter than the old keyboards.
They take a sample of 4 keyboards manufactured using the old material and compute an
average weight of 21 kg with a standard deviation of 1 kg.
They take a sample of 8 keyboards manufactured using the new material and compute an
average weight of 17 kg with a standard deviation of 2 kg.
a. Conduct an appropriate hypothesis test using the p-value method. Use the old
material as population 1. [8 marks]
b. How much evidence is there against the null hypothesis in part (a)? [1 mark]
c. Explain what a Type II Error means in this context. [1 mark

3.An insurance company is interested in estimating the population mean cost of basic dental
cleaning at dentists in Saskatoon. Suppose there are only two dentists in Saskatoon:
Dentist A and Dentist B. Suppose also that the cost of basic dental cleaning varies only
depending on how well the patient practices regular dental hygiene, so that the cost of
basic dental cleaning roughly follows a Normal distribution regardless of the dentist.
The insurance company selects 8 sample patients and sends them to both Dentist A and
Dentist B. They send the patients in random order, such that half of the patients are seen
by Dentist A first, and half are seen by Dentist B first, so as not to bias the results. The
cost of basic dental cleaning for these 8 patients seen by both Dentists A and B are
provided below. The insurance company would like to determine whether the population
mean cost of basic dental cleaning by Dentist A is different from the population mean
cost of basic dental care by Dentist B. Let the population of costs of basic dental care
from Dentist A be population 1.
Patient 1 2 3 4 5 6 7 8
Dentist A $100 $120 $125 $110 $95 $105 $120 $115
Dentist B $150 $100 $140 $100 $95 $105 $100 $120
Conduct an appropriate hypothesis test using the critical value method. [10 marks]

Jack Winters owns a small business, offering construction services for Disney. To save money on his bids, he subcontracts all of the painting out to another company called Painters Inc. While balancing QuickBooks from the actual “job invoices” and receipts, Jack notices a discrepancy. Painters Inc. was issued a check for $14,125, but the job invoice shows that the job was finished for $12,125. Jack contacts Painters Inc, who provides proof that they received payment for $12,125. Besides Jack, only one person had access to the accounting software. You have been called to investigate.

Write a one-page report detailing the steps Jack needs to take to gather all of the appropriate evidence and protect his company.

What is consumerism? Explain this concept based on US examples of consumerism and its impact on US economy.

Jessica is a recent graduate of Brenau University’s business school entrepreneurship program. The business plan that she created before she graduated was for a business developing websites for individuals and commercial businesses. Friends and family provided funding for the start-up, and she has been in business for the last two and a half years.

Jessica had learned about the balanced scorecard in her accounting classes and has been applying some of the techniques. Her vision for this business is to provide clients with high quality websites that receive a relatively high numbers of hits. Recently, word-of mouth advertising had led to more requests for websites with creative animated graphics. As part of her balanced scorecard, she tracked the following measures over the last two years for her individual clients:

                                                                                              20x1                20x2

Average revenue per individual client                              $2,000             $1,500

Average time from start to finish (business days)           10 days            13 days

Average site ranking on top two search engines                     15                    21

Total revenue                                                                   $80,000           $78,000

Total labor cost                                                                $20,000           $22,000

Utilities cost (electricity and phone)                                 $2,100             $2,400

Number of individual clients                                                    40                    52

Employee turnover                                                                     1                      0

a.   Classify each performance measure according to one of the four balanced scorecard perspectives. Explain your reasoning.

b.   Analyze the change in each performance measure from 20X1 to 20X2. Give one possible reason for the change.

Eight studies are described briefly below. What research method was employed in these studies, also write the rationale of your choice of response.
1.   A researcher is interested in whether drinking water right before bed increases the likelihood that children will wet the bed at night. The researcher recruits 50 5-year-old children to participate in her study. Twenty-five children are given two glasses of water two hours before their bedtime (one glass per hour) and twenty-five children are prohibited from receiving liquids within two hours of their bedtime.
2.   A researcher was interested in how children learn how to settle disagreements with peers. The researcher talked to his five-year-old daughter and asked her to describe how she interacted with her peers. The researcher then read a few stories to his daughter about children her age who got into disagreements and asked her what she would do in that situation. The researcher continued to interview his daughter like this for five years.
3.   University officials have noticed that there is a relationship between scores on the Graduate Record Exm (GRE) and performance in graduate school. Specifically, those students with the highest scores tend to do best in school.
4.   In an attempt to determine which method would assure the best class attendance, an educational psychologist had one teacher reward students for attending class with extra points, a second teacher punish absences by deducting points, a third teacher scold students for absences, and a fourth teacher do nothing unusual. Attendance was best in the first class where the teacher rewarded the students.
5.   A researchers is interested in whether people are more likely or less likely to help someone in distress when others are present. Some subjects were testes when they alone were witness to someone in distress, while others were tested when many people were present. The researcher discovered that witnesses were much more likely to help when hey alone witnessed the person in distress.
6.   In an attempt to determine which method would assure the best class attendance, an educational psychologist had one teacher reward students for attending class with extra points, a second teacher punish absences by deducting points, a third teacher scold students for absences, and a fourth teacher do nothing unusual. Attendance was best in the first class where the teacher rewarded the students.
7.   A researcher who was suspicious that hyperactivity in children was related to the amount of sugar in their diet recorded both sugar intake and activity level for a sample of children over a five month period. The results indicated that those children who had consumed the most sure tended to be the most active.
8.   In an investigation of drug abuse, it was noted that there was a relationship between the ages at which an individual first started experimenting with drugs and the severity of the drug abuse problem. Specially, those who experimented with drugs at the earliest age tended to be those with the most severe drug abuse problems.
9.   To investigate the relationship between anxiety and test performance, three groups of subjects are tested under one of the following conditions: high anxiety, moderate anxiety, low anxiety. The moderate anxiety group performs between on the test than either the high anxiety or the low anxiety groups.
10.   Researchers looking at the relationship between intelligence and birth order found that the children with the highest IQ scores were most likely to the first born in the family.
11.   In a study of animal motivation, researchers varied the number of hours their laboratory animals were deprived of food. While some had food continuously available, others were deprived for 12 hours, and some were deprived for 24 hours. The researchers discovered that the animals deprived for 24 hours worked harder for food than did the others.

Ethics and the Manager, Understanding the Impact of Percentage Completion on Profit—Weighted-Average Method LO4–2, LO4–3, LO4–4

Gary Stevens and Mary James are production managers in the Consumer Electronics Division of General Electronics Company, which has several dozen plants scattered in locations throughout the world. Mary manages the plant located in Des Moines, Iowa, while Gary manages the plant in El Segundo, California. Production managers are paid a salary and get an additional bonus equal to 5% of their base salary if the entire division meets or exceeds its target profits for the year. The bonus is determined in March after the company’s annual report has been prepared and issued to stockholders.

Shortly after the beginning of the new year, Mary received a phone call from Gary that went like this:

1.     Gary:How’s it going, Mary?

2.     Mary:Fine, Gary. How’s it going with you?

3.     Gary:Great! I just got the preliminary profit figures for the division for last year and we are within $200,000 of making the year’s target profits. All we have to do is pull a few strings, and we’ll be over the top!

4.     Mary:What do you mean?

5.     Gary:Well, one thing that would be easy to change is your estimate of the percentage completion of your ending work in process inventories.

6.     Mary:I don’t know if I can do that, Gary. Those percentage completion figures are supplied by Tom Winthrop, my lead supervisor, who I have always trusted to provide us with good estimates. Besides, I have already sent the percentage completion figures to corporate headquarters.Page 181

7.     Gary:You can always tell them there was a mistake. Think about it, Mary. All of us managers are doing as much as we can to pull this bonus out of the hat. You may not want the bonus check, but the rest of us sure could use it.

The final processing department in Mary’s production facility began the year with no work in process inventory. During the year, 210,000 units were transferred in from the prior processing department and 200,000 units were completed and sold. Costs transferred in from the prior department totaled $39,375,000. No materials are added in the final processing department. A total of $20,807,500 of conversion cost was incurred in the final processing department during the year.

Required:

1.     Tom Winthrop estimated that the units in ending work in process inventory in the final processing department were 30% complete with respect to the conversion costs of the final processing department. If this estimate of the percentage completion is used, what would be the cost of goods sold for the year?

2.     Does Gary Stevens want the estimated percentage completion to be increased or decreased? Explain why.

3.     What percentage completion would result in increasing reported net operating income by $200,000 over the net operating income that would be reported if the 30% figure were used?

4.     Do you think Mary James should go along with the request to alter estimates of the percentage completion? Why or why not? (Note: besides the fact that manipulating numbers to meet an earnings goal is wrong tell me A) how it would negatively impact shareholders’ B) which financial statements would be impacted and how would it impact those statements C) what would be the potential ramifications if the auditors discovered the estimate manipulation D) how might the auditors discover the estimate manipulation and E) and what might happen if other employees found out about the estimate manipulation?

5.     If you were Mary, name three options you would have in dealing with this situation?

6.     If you are Mary what is your opinion of Gary after this conversation?

7.     Would you likely/not likely support a promotion for Gary within the company? Why or Why not?

8.     Are there any legal consequences to Mary if she changes the completion percentage?

9.     What percentage chance (0 – 100%) do you give yourself that you will be faced with an ethical dilemma in your career within the first 10 years post-graduation?

Warnerwoods Company uses a perpetual inventory system. It entered into the following purchases and sales transactions for March.

3. Compute the cost assigned to ending inventory using (a) FIFO, (b) LIFO, (c) weighted average, and (d) specific identification. For specific identification, the March 9 sale consisted of 140 units from beginning inventory and 270 units from the March 5 purchase; the March 29 sale consisted of 120 units from the March 18 purchase and 160 units from the March 25 purchase.

DO ALL 4!!!

Compute the cost assigned to ending inventory using specific identification. For specific identification, the March 9 sale consisted of 140 units from beginning inventory and 270 units from the March 5 purchase; the March 29 sale consisted of 120 units from the March 18 purchase and 160 units from the March 25 purchase.

4. Compute gross profit earned by the company for each of the four costing methods. For specific identification, the March 9 sale consisted of 140 units from beginning inventory and 270 units from the March 5 purchase; the March 29 sale consisted of 120 units from the March 18 purchase and 160 units from the March 25 purchase. (Round weighted average cost per unit to two decimals and final answers to nearest whole dollar.)

FIFO LIFE AVG Cost Spec ID
sales

less COGS

GP

2. Consider whether the US government should break up the biggest US banks. Why or why not? If the United States does so, and other nations have very large government banks, or have very large private banks, can US banks remain competitive?