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For another individual, current annual income is $150 of which 30% is earned through
lottery winnings. If this person tends to spend 80% of his annual salary,
i. Calculate the value of this person’s estimated annual salary.
ii. Derive an expression for this person’s consumption function clearly
describing each term.
iii. Derive and expression for this person’s average propensity to consume
clearly describing any new terms included.
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Solved in 4 steps
- An individual has monthly expenses of $1,800 for rent and $1,000 for groceries, transportation, and other necessary expenses.Which average return should the individual expect to match 25% of yearly expenses on a $100,000 investment?1. If the company want to achieve target net income $800,000 and the tax rate is 30%, calculate how many units to be sold to achieve those targets? 2. The owner estimates that if he can spend an additional $75,000 towards sales promotion,sales in unit may increase by 30%. What should Mr. Budi’ decision be?Assume you are a salesperson earning 10 percent commission and you have sold $540,000 in products this year. What are your commission earnings for the year (show your math). Based on this, if you were on a draw of $50,000, would you earn your draw or commission?
- At the end of the year, if Malek reaches his annual sales quota, he is given an extra $10,000. This is an example of Multiple Choice a salary. a stipend. a commission. an output measure. a bonus.If you earned $80, 000 this year, you would pay more CPP than your brother, who earned $ 60,000. Agree or disagree and explain your answer.Suppose that Thomas Lee is enrolled in a defined contribution plan in which the employer contributes $8,000 each year. Thomas is earning $80,000 this year and his tax rate is 30 percent (which is not expected to change). Assume that the before- tax rate of return is 8 percent. (a) What is the additional amount of funds that Thomas will have when he reaches retirement in 10 years as a result of this year's service? (b) Suppose that Thomas's employer is planning to reduce half of their contribution to the defined contribution plan. Assume that Thomas would like to keep his retirement funds the same as they would have been with the defined contribution plan. If Thomas's only opportunity to save for retirement is in a nonqualified savings plan (no tax benefits), how much would Thomas need to receive in additional salary (which he would then save) to achieve his objective?
- You have been hired for your dream job in healthcare. Your salary is $10,000 per month. Your taxes are $2500 per month. Your rent, food and transportation are a total $5000 per month. How much is your gross income? How much is your disposable income? What is another more common word for disposable income? How much is your discretionary income? Give me one example of what you would use your discretionary income for and how much you'd spend on that item?Sharon is a manufacturer's representative selling office furniture directly to businesses. She receives a monthly salary of $2000 plus a 2.2% commission on sales exceeding her quota of $150,000 per month. a. What are her earnings for a month in which she has $227,000 in sales? (Round your answer to the nearest cent.) Earnings = b. If her average monthly sales are $235,000, what straight commission rate would generate the same average monthly earnings as her current basis of remuneration? (Round your answer to four decimal places.) Commission rate =Your company has sales of $97,200 this year and cost of goods sold of $71,200. You forecast sales to increase to $113,100 next year. Using the percent of sales method, forecast next year's cost of goods sold.
- suppose you sell 8,000 of the 3 pack lenses described in question 3 above in one year. You cost on each 3 pack is $29.95 and you sell them for $59.95. if your operating expenses for the year total $144.080, what are your Net Income and Net profif margin percentage?The following information relates to a company selling 25000 pairs of shoes for a year; sellingprice per unit- GH¢40, purchase cost per unit- GH¢25, fixed cost is made up of salariesGH¢100000, advertising- GH¢40000 and other fixed cost- GH¢100000. If a selling commissionof GH¢2 per pair was introduced, how many pairs should be sold to earn an after-tax profit ofGH¢12000 assuming a tax rate of 40%? A. 30000units B. 20000units C. 15000units D. 25000units Consider the information below for a company whose products goes through two processes;material cost of GH¢100000 for a quantity of 10000kg, labour cost- GH¢50000 and overheadcost as twice the cost of labour. The company expected an output of 9500kg from process 1 buteventually obtained 9400kg. The actual output of 9400kg shows that A. There is an abnormal gain of 100kg B. There is an abnormal loss of GH¢2632 C. Cannot determine without further details D. A normal lossAdriana Co., with annual net sales of $5 million, maintains a markup of 25% based on cost. Adriana’s expenses average 15% of net sales. What is Adriana’s gross profit and net profit in dollars?