If a firm has a constant returns to scale production function F(K,L), then the break even price does not depend on the input prices (w,r) True False
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- The local 99 cent store, whose product prices are capped at 99 cents, is capitalizing on a price strategy known as odd pricing. ( a) True b) FalseHi, the answer is incorreect for the x,y nd optimal profit. Any help appriciated immediately as this is due. Thanks so muchProduct Cost under Full vs. Variable Costing Kate’s Kale Chips produces a healthy snackmade primarily of kale. Each bag of the product sells for $5. The company computes the manufacturing overhead rate on a quarterly basis based upon the planned number of units to be produced thatquarter. The following data are from the projections of Kate’s Kale Chips for the upcoming quarter:[LO 18-4]ProjectionsSales 20,000 bagsProduction 22,000 bagsVariable manufacturing cost per bag $2.00Sales and distribution costs per bag $0.15Total fixed manufacturing overhead $33,000Fixed administrative overhead $18,000Required1. Compute the projected product cost per bag produced under full costing.2. Compute the projected product cost per bag under variable costing
- A firm sells two products. Product R sells for $20; its variable cost is $6. Product S sells for $50; its variable cost is $30. Product R accounts for 60 percent of the firm’s sales, while S accounts for 40 percent. The firm’s fixed costs are $4 million annually. Calculate the firm’s break-even pointIf a 3% increase in the price of corn flakes causes a 6% decline in the quantity demanded, what is the elasticity of demand?a) b) c) d) e) f) g) h) i) What is the optimal solution (in words? An additional 4 hours of shaper time became available. Evaluate the effect? Explain- Two hours of Grinder time was lost. Evaluate the effect? An additional 20 units of component 3 was requested. Evaluate the effect. The demand for component 2 decreased by 30 units. Evaluate the effect Suppose that the profit contribution of component 1 increases to $9.00. What is the new optimal solution? Suppose that the profit contribution of component 3 decrease by $2.00 . Would the optimal solution change Is the problem degenerate? Explain! Are there alternative optima in this problem? Explain
- Consider a hardware supply warehouse that is contractually obligated to deliver 1000units a specialized fastener to a local manufaturing company each week. Each time thewarehouse places an order for these items from its supplier, an ordering and transporationfee off $20 is charged to the warehouse. The warehouse pays $1.00 for each fastener andcharges the local firm $5.00 for each fastener. Annual holding cosst iss 25% off inventoryvalue, or $0.25 per year. The warehouse manager would like to know how much to orderwhen inventory gets to zero.Assume that the warehouse works 50 weeks/year.A company is known to have 4 request periods in 1 year. In the first quarter year demand amounted to 750, the 2nd quarter was 900, the third quarter was 1500, and for the fourth quarter it was 900. If the company has an initial inventory of 100, the desired final inventory is 150 units, the cost of normal hours is 100 rupiah/unit, the overtime hour fee is 125 rupiah/unit, the cost of sub-contract hours is 150 rupiah/unit, and lastly the cost of inventory is known to be 20 rupiah per unit per period. Here is the table of normal hours, overtime hours and subcontracts. Period Normal Hours Ovetime Hours Subcontracts 1 700 146 500 2 800 146 500 3 900 146 500 4 500 146 500 Please specify:a. Total cost!b. How much is produced per quarter?c. Analyze Your Answers!In an expansionist strategy, if the demand is increasing and the time between increments increases, the size of the increments must: a. increase. b. increase or decrease depending on competitor actions. c. decrease. d. remain unchanged.
- Tyrelle's T-shirts purchases shirts for $4. If a markup of $5 per shirt is applied, the selling price for each shirt is $9. True FalseElkins, a manufacturer of ice makers, realizes a cost of $250 for every unit it produces. Its total fixed costs equal $5 million. If the company manufactures 500,000 units, compute the following:a. unit costb. markup price if the company desires a 10% return on salesc. ROI price if the company desires a 25% return on an investment of $1 millionA colleague has made the following statements: In the long term most production overheads are variable Traditional absorption costing systems tend to give too much overhead cost to high volume products. Which statements are correct? a) Neither statement 1 nor statement 2 b) Only statement 1 c) Only statement 2 d) Both statements 1 and 2