Problem Set Seven Solutions Chapter 9 1. Two car manufacturers‚ Saab and Volvo‚ have fixed costs of $1 billion and constant marginal costs of $10‚000 per car. If Saab produces 50‚000 cars per year and Volvo produces 200‚000‚ calculate the average fixed cost and average total cost for each company. On the basis of these costs‚ which company’s market share should grow in relative terms? Answer: Average total cost is average fixed cost plus marginal cost: ATC = FC/Q + MC. Volvo’s average fixed cost
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answers for the same problems. One is bringing the present value to the future and the other is bringing the future value to the present. In each one of them‚ different solutions were proposed. A. Present Value to the future Option 1: $10‚000 now with 11% interest. $10‚000 x 11% = $11‚100(10‚000 + 1‚100) 1‚100 x 8 yrs = $8‚800 + $10‚000 = $18‚800 $10‚000 now with 12% interest. $10‚000 x 12% = $11‚200 (10‚000 + 1‚200) 1‚200 x 8 yrs = $ 9‚600 + 10‚000 = $19‚600 Option 2: $2‚000 a year for
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(32‚000 x 6/12) Intra-group sales URP in inventory Additional depreciation (2‚000/5 years x 6/12) $’000 63‚000 16‚000 (8‚000) 800 200 ––––––– 72‚000 ––––––– The unrealised profit (URP) in inventory is calculated as ($8 million – $5·2 million) x 40/140 = $800‚000.
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PROBLEM SET 5: INTEREST RATES‚ AMORTIZING LOANS‚ BOND VALUATION‚ STOCK VALUATION 1. A typical credit card agreement quotes an interest rate of 18 percent APR. Monthly payments are required. What is the actual interest rate you pay on such a credit card? 2. After carefully going over your budget‚ you have determined you can afford to pay €632 per month toward a new sports car. You call up your local bank and find out that the going rate is 1 percent per month for 48 months. How much you can borrow
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4-MAT BOOK REVIEW 2 BY TONNIE L. COLLINS DR. CHARLES DAVIDSON CHPL 600 600-BO2 SEPTEMBER 21‚ 2014 Table of Contents Abstract…………………………………………………………………………..3-4 Concrete Response………………………………………………………………..4-5 Reflection……………………………………………………………………………5 Action……………………………………………………………………………..5-6 Bibliography…………………………………………………………………………7 Abstract Ronald N. Nash does a great job in his book Is Jesus the only Savior‚ Ronald Nash not at one time left the truth of the Christian
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Econ 136: Financial Economics Problem Set #1 Due Date: September 11‚ 2014 1. The return profile and risk of the S&P 500. In this exercise you will reproduce the graphs presented in class. The goal of this exercise is (i) to expand your datahandling skills‚ (ii) test your understanding of basic probability concepts using real data and (iii) develop an appreciation for the use of replicating a result to ensure that you understand it. Go to Yahoo Finance (finance.yahoo.com) and search for the ticker
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Module 3 – Chapter 12 Problem 12-1A Part 1 KAZAAM COMPANY Statement of Cash Flows For Year Ended December 31‚ 2011 Cash flows from operating activities Net income $73‚750 Adjustments to reconcile net income to net cash provided by operating activities Increase in accounts receivable ($49‚625 - $65‚000) (15‚375) Increase in inventory ($252‚500 - $273‚750) (21‚250) Decrease in prepaid expenses ($6‚250 - $5‚375) 875 Decrease in
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Operations Page 27‚ question 2: Suds and Duds Laundry A. Week | Hours(input) | Shirts(output) | Ratio | 1 | 24 | 68 | 2.83 Shirts/hour | 2 | 46 | 130 | 2.83 Shirts/hour | 3 | 62 | 152 | 2.45 Shirts/hour | 4 | 51 | 125 | 2.45 Shirts/hour | 5 | 45 | 131 | 2.91 Shirts/hour | B. The output difference isn’t large between the input and output ratio. It seems as if producitivity may decline if there were more people working. If Suds and Dud has more than 2 or 3 workers on the amount of work
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Industrial Organization‚ Spring Semester (2013) Mark McCabe Problem Set 1 Due in class on 27. March Instructions: Please show all of your work‚ e.g. all of the calculations associated with each solution. Your solutions should be typed and not handwritten. As I mentioned in class‚ students may work together to solve these problems‚ but plagiarism or copying is not permitted. On the 27th‚ please bring a paper copy to class‚ and e-mail me a digital copy (mccabe@umich.edu) before the beginning
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Two Variable Inequalities Kristine Heckman MAT 222 Intermediate Algebra Instructor Leah Murray November 4‚ 2013 TWO VARIABLE INEQUALITIES For this assignment‚ I am going to work with two-variable inequalities and demonstrate the practical application of these inequalities. I am going to use a graph that shows the number of TV’s on the left side and the number of refrigerators on the bottom. Of course this would mean that my x axis is the bottom‚ and my y axis on the
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