A house owner wants to maintain his house. What is the economic term for this desire? What enables a baker to obtain new shoes from a cobbler who doesn't need any baked goods?

Equilibrium prices will spontaneously establish themselves in a competitive market and will persist until things changes?

Which describes a price mechanism through which the government may correct a failing market?

Which is most likely to increase the supply of soldiers for an all-volunteer army?

A trapezoid-shaped potato with base lengths of 1.5 cm and 2.0 cm respectively and a height/thickness of 0.5 cm was dried at a temperature of 70 ^oC in a convective oven for 24 h, if the surface temperature of the potato remained at 65 ^oC throughout the drying operation, describe the different changes that occurs during the constant and falling rate periods. If the convective heat transfer coefficient of stem/water is given as 850 W/m^2oC, calculate the amount of heat transferred into the potato

Topic- exercising 4 times a week

The conclusion should include (1) which consumer behavior topics gave you the most insight into your behavior and why, (2) what results did you see in changing your behavior these past 3 months and (3) based on what you have learned, how you might get better results (specific changes in behavior and attitudes) by doing something different than you attempted.

EMU ELECTRONICS

Emu electronics is an electronics manufacturer located in Box Hill, Victoria. The company’s managing director is Shelly Chan, who inherited the company from the father. The company originally repaired radios and other household appliances when it was founded more than 50 years ago. Over the years. The company has expanded, and it is now a reputable manufacturer of various specialty electronics items. Robert McCanless, a recent MBA graduate, has been hired by the company in the finance department.     

One of the major revenue-producing items manufactured by Emu electronics is a smart phone. Emu electronics currently has a smart phone model on the market and sales have been excellent. The smart phone is a unique item in that it comes in a variety of colours and is pre-programmed to play Jimmy Barne’s music. However, as with any electronic item, technology changes rapidly, and the current smart phone has limited features in comparison with newer models. Emu electronics has spent $1 200 000 developing a prototype for a new smart phone that has all the features of the existing one, but adds new features, such as Wifi tethering. The company has spent a further $250 000 for a marketing study to determine the expected sales figures for the new smart phones.

   Emu electronics production manager has produced estimates of the costs associated with manufacture of the new smart phone. Variable costs are estimated at $210 per unit and fixed costs for the operation are expected to run at $5.3 million per year. The estimated sales volume is 64 000 units in the year 1; 106 000 units in the year 2; 87 000 units in the year 3; 78 000 units in Year 4; and 54 000 units in the final year. The unit price of the smart phone will be $515. The necessary manufacturing equipment can be purchased for $38.5 million and will be depreciated for tax purposes over a seven-year life (straight-line to zero). It is believed the value of the manufacturing equipment in five years’ time will be $5.8 million.

    Net working capital for the smart phones will be 20% of sales and will have to be purchased at the end of the year. The cost of the raw materials is reflected in the variable unit cost. Changes in NWC will first occur at the end of Year 1 based on the first years’ sales. Emu electronics has a 30% corporate tax rate and a 12% required return.

    Shelly has asked Robert to prepare a report that answers the following questions.

Questions

1. What is the payback period of the project?

2. What is the profitability index of the project?

3. What is the IRR of the project?

4. What is the NPV of the project?

5. How sensitive is the NPV to changes in the price of the smart phone?

6. How sensitive is the NPV to changes in the quantity sold?

7. Should Emu electronics produce the new smart phone?

8. Suppose Emu electronics loses sales on other models because of the introduction of the new model. How would this affect your analysis?

MIni Case

EMU Electronics

Emu Electronics manufacturer located in Box Hill, Victoria. The company's managing director is Shelly Chan, who inherited the company from her father. The company originally repaired radios and other household appliances when it was founded more than 50 years ago. Over the years, the company has expanded, and it is now a reputable manufacturer of various specialty electronic items. Robert McCanless, a recent MBA graduate, has been hired by the company in the finanace department.

One of the major revenue-producing items manufactured by Emu Electronics is a smart phone. Emu Electronics currently has one smart phone model on the market and sales have been excellent. The smart phone is a unique item in that it comes in a variety of colours and is pre-programmed to play Jimmy Barnes music. However, as with any electronic item, technology changes rapidly, and the current smart phone has limited features in comparison with newer models. Emu Electronics has spent $1200000 developing a prototype for a new smart phone that has all the features of the existing one, but adds features, such as Wifi tethering. The company has spent a further $250000 for a marketing study to determine the expected sales figures for the new smart phone.

Emu Electronics' production manager has produced estimates of the costs associated with manufacture of the new smart phone. Variable costs are estimated at $210 per unit and fixed costs for the operation are expected to run at $5.3 million per year. The estimated sales is 64000 units in Year 1; 106000 units in Year 2; 87000 units in Year 3; 78000 units in Year 4 and 54000 units in the final year. The unit price of the new smart phone will be $515. The necessary manufacturing equipment in five years time will be $5.8 million.

Net working capital for the smart phones will be 20% of sales and will have to be purchased at the end of the year. The cost of the raw materials is reflected in the variable unit cost. Changes in NWC will first occur at the end of Year ! based on the first year's sales. Emu Electronics has a 30% corporate tax rate and a 12 % required return.

Shelly has asked Robert to prepare a report that answers the following questions:

1. What is the payback period of the project?

2. What is the profitability index of the project?

3. What is the IRR of the project?

4. What is the NPV of the project?

5. How sensitive is the NPV to changes in the price of the new smart phone?

6. How sensitive is the NPV to changes in the quantity sold?

7. Should Emu Electronics produce the smart phone?

8. Suppose Emu Electronics loses sales on other models because of the introduction of the new model. How would this affect your analysis?

RAK, Inc., has no debt outstanding and a total market value of $150,000. Earnings before interest and taxes, EBIT, are projected to be $26,000 if economic conditions are normal. If there is strong expansion in the economy, then EBIT will be 12 percent higher. If there is a recession, then EBIT will be 20 percent lower. RAK is considering a $90,000 debt issue with an interest rate of 6 percent. The proceeds will be used to repurchase shares of stock. There are currently 10,000 shares outstanding. Ignore taxes for questions a and b. Assume the company has a market-to-book ratio of 1.0.

a-1

Calculate return on equity (ROE) under each of the three economic scenarios before any debt is issued. (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

ROE
  Recession %  
  Normal %  
  Expansion %  

a-2

Calculate the percentage changes in ROE when the economy expands or enters a recession. (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

% change in ROE
  Recession %  
  Expansion %  

Assume the firm goes through with the proposed recapitalization.

b-1

Calculate the return on equity (ROE) under each of the three economic scenarios. (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

ROE
  Recession %  
  Normal %  
  Expansion %  

b-2

Calculate the percentage changes in ROE when the economy expands or enters a recession. (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

% change in ROE
  Recession %  
  Expansion %  

Assume the firm has a tax rate of 35 percent.

c-1

Calculate return on equity (ROE) under each of the three economic scenarios before any debt is issued. (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

ROE
  Recession %  
  Normal %  
  Expansion %  

c-2

Calculate the percentage changes in ROE when the economy expands or enters a recession. (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

% change in ROE
  Recession %  
  Expansion %  

c-3

Calculate the return on equity (ROE) under each of the three economic scenarios assuming the firm goes through with the recapitalization. (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

ROE
  Recession %  
  Normal %  
  Expansion %  

c-4

Given the recapitalization, calculate the percentage changes in ROE when the economy expands or enters a recession. (Negative amounts should be indicated by a minus sign. Round your answers to 2 decimal places. (e.g., 32.16))

% change in ROE
  Recession %  
  Expansion %

RAK, Inc., has no debt outstanding and a total market value of $250,000. Earnings before interest and taxes, EBIT, are projected to be $42,000 if economic conditions are normal. If there is strong expansion in the economy, then EBIT will be 18 percent higher. If there is a recession, then EBIT will be 30 percent lower. RAK is considering a $100,000 debt issue with an interest rate of 8 percent. The proceeds will be used to repurchase shares of stock. There are currently 10,000 shares outstanding. Ignore taxes for questions a and b. Assume the company has a market-to-book ratio of 1.0.

a. An increase in the price level in an economy will _____.​

b. A decrease in the price level in an economy will _____.​

c. An aggregate demand curve is created by getting different points from :​

d. The aggregate demand curve of an economy illustrates the :​

e. If the consumption spending (C) in an economy increases at a given price level, _____.​

f. If the consumption spending (C) in an economy decreases at a given price level, _____.​