Fact Pattern 2-1AJava Cafes, Inc., and Kaffe Import Corporation dispute a term in their contract.Refer to Fact Pattern 2-1A. The least expensive method to resolve the dispute between Java and Kaffe may be
A. arbitration because the case will be heard by a mini-jury.
B. litigation because each party will pay its own legal fees.
C. mediation because the dispute will be resolved by a non-expert.
D. negotiation because no third parties are needed.
Answer: D
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A) It provides consumers the satisfaction of instant gratification. B) It reduces the cost of doing business. C) It enables specialized businesses to be more successful. D) It provides consumers more access to pricing information. E) It broadens product choices for consumers in smaller communities.
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Fill in the blank(s) with the appropriate word(s).
Shultz Business Systems is analyzing an average-risk project, and the following data have been developed. Unit sales will be constant, but the sales price should increase with inflation. Fixed costs will also be constant, but variable costs should rise with inflation. The project should last for 3 years, it will be depreciated on a straight-line basis, and there will be no salvage value. This is just one of many projects for the firm, so any losses can be used to offset gains on other firm projects. What is the project's expected NPV?
Project cost of capital (r)10.0% Net investment cost (depreciable basis)$200,000 Units sold50,000 Average price per unit, Year 1$25.00 Fixed op. cost excl. deprec. (constant)$150,000 Variable op. cost/unit, Year 1$20.20 Annual depreciation rate33.333% Expected inflation rate per year5.00% Tax rate25.0% A. $27,625 B. $29,079 C. $30,610 D. $32,140 E. $33,747