Businesses influential enough to affect the price of an item are price takers
Indicate whether the statement is true or false
False
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________ needs are the operational needs related to the engineering aspect of making the product
A) Primary B) Secondary C) Tertiary D) Biological
Your company, which is financed entirely with common equity, plans to manufacture a new product, a cell phone that can be worn like a wristwatch. Two robotic machines are available to make the phone, Machine A and Machine B. The price per phone will be $260.00 regardless of which machine is used to make it. The fixed and variable costs associated with the two machines are shown below, along with the capital (all equity) that must be invested to purchase each machine. The expected sales level is 27,000 units. Your company has tax loss carry-forwards that will cause its tax rate to be zero for the life of the project, so T = 0. How much higher or lower will the project's ROE be if you select the machine that produces the higher ROE, i.e., what is ROEB - ROEA? (Hint: Since the firm uses no
debt and its tax rate is zero, ROE = EBIT/Required investment.) Machine AMachine BPrice per phone (P)$260.00 $260.00 Fixed costs (F)$1,000,000 $2,000,000 Variable cost/unit (V)$210.00 $160.00 Expected unit sales (Q)27,000 27,000 Required equity investment$2,500,000 $3,000,000 ? A. 11.20% B. 8.87% C. 7.84% D. 7.75% E. 9.33%
A manager at Dillard's discovers that JCPenney has reduced the price of its children's Levi's from $31.99 to $24.99, according to an advertisement in the Sunday newspaper. She immediately phones her store and instructs the salesperson on duty to put a sign up next to their children's Levi's that reads, "SALE: $24.99." This is an example of what pricing strategy?
A. Secondary-market pricing B. Periodic discounting C. Reference pricing D. Random discounting E. Comparison discounting
Which of the following is used to back international sales of goods and services?
A. certificate of deposit B. bankers' acceptance C. eurodollar deposits D. commercial paper