5. can sell only $3,000,000 worth of goods. Job applicants know if they are good or bad, but the fim does not. A fim will offer job applicants a choice between a fixed salary or 25% commission. Assuming risk-neutral salespersons and no opportunistic behavior, what level must the fixed salary be so that the fim can distinguish a prospective good salesperson from a poor one, and thereby avoid hiring a poor one? A good salesperson can sell $4,000,000 worth of goods, while a poor one

5. can sell only $3,000,000 worth of goods. Job applicants know if they are good or bad, but the fim does not. A fim will offer job applicants a choice between a fixed salary or 25% commission. Assuming risk-neutral salespersons and no opportunistic behavior, what level must the fixed salary be so that the fim can distinguish a prospective good salesperson from a poor one, and thereby avoid hiring a poor one? A good salesperson can sell $4,000,000 worth of goods, while a poor one

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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6) When Walmart is accused of offering very low wages to their workers they often counter that because of their cost controlling ways, they can offer prices 20% lower than their competitors, which is like increasing the income of all Americans by 25%. Illustrate Walmart's claim more formally using a hypothetical individual who makes $20,000/yr who spends his money on food and clothes and supposing that at stores other than Walmart food costs $5/lb and clothes cost $20/item.
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Help please... also for 2b.) $(41,000)
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Bradley plc operates in the electronics industry. It has found that the prices being charged by its suppliers are increasing in line with inflation in the wider economy. An external consultant has been asked to outline for Bradley plc’s board the types and causes of inflation, and has made the following statementsDemand pull inflation arises from a persistent excess of supply in the economy as a wholeCost push inflation may arise from wage increasesWhat is the validity of the external consultant’s statements?A. Both statements are falseB. Only the first statement is trueC. Only the second statement is trueD. Both statements are true
Sometimes compensation packages include bonuses designed to provide performance incentives to employees. The difficulty a bonus can cause accountants is not an accounting problem, but a math problem. The complication is that the bonus formula sometimes specifies that the calculation of the bonus is based in part on the bonus itself. This occurs anytime the bonus is a percentage of income because expenses are components of income, and the bonus is an expense. Regalia Fashions has an incentive compensation plan through which a division manager receives a bonus equal to 15% of the division’s net income. Division income in 2024 before the bonus and income tax was $250,000. The tax rate is 30%. Calculate the amount of the bonus. Prepare the adjusting entry to record the bonus compensation. Bonus arrangements take many forms. Suppose the bonus specifies that the bonus is 10% of the division’s income before tax, but after the bonus itself. Calculate the amount of the bonus.
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