Principles of Economics (12th Edition)
12th Edition
ISBN: 9780134078779
Author: Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Question
Chapter 23, Problem 2.2P
Subpart (a):
To determine
Actual investment of the company.
Subpart (b):
To determine
Planned investment of the company.
Subpart (c):
To determine
Production in upcoming year.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Suppose that you are running a business, and you need some extra space for one year. Your bank offers you a loan of $200,000 at 0% interest. You consider borrowing this amount to buy the building, use it for one year, and then sell the building to pay back the loan.
Unfortunately, the economy in which you are operating is experiencing deflation at the rate of 10% per year.
After one year, you should be able to sell the building for___________.
Suppose that owning the building for a year would earn you $12,000. To decide whether you will be better off by owning it for one year and then selling it, you seek advice from three different people: (1) Your brother says that you should not buy the building because in one year it will cost you $200,000. (2) Your accountant says that you should definitely buy the building because you can borrow $200,000 at zero interest while the building will generate $12,000 in extra income. Then when you sell it, you will be $12,000 richer. (3) Your…
Economics
Suppose that in the year 2015, Oceanaire, Inc.
planned to produce 525,000 units of its lightweight
scuba tanks. Of the 525,000
it planned to produce, a total of 35,000
units would be added to the inventory at its new
plant in Arizona. Also assume that these units have
been selling at a price of $250
each and that the price has been constant over
time. Suppose further that this year the firm built a
new plant for $4 million and acquired $3.5 million
worth of equipment. It had no other investment
projects, and to avoid complications, assume no
depreciation.
Now suppose that at the end of the year, Oceanaire
had produced 525,000 units but had only sold
485,000 units and that inventories now contained
40,000 units more than they had at the beginning
of the year. At $250 each, that means that the firm
added $10,000,000 in new inventory.
This year Oceanaire actually invested $.
Oceanaire planned to invested $_?
?
A young chef is considering opening his own sushi bar. To do so, he would have to quit his current job, which pays $30,000 a year, and take over a restaurant space that he owns and currently rents to his brother for $24,000 a year. His expenses at the sushi bar would be $50,000 for food and $2,000 for gas and electricity.
Suppose the sushi bar’s revenue from the first year is $120,000. What is the chef’s economics profit?
14,000
-14,000
66,000
68,000
Chapter 23 Solutions
Principles of Economics (12th Edition)
Knowledge Booster
Similar questions
- Analysts say that the increase in gasoline prices comes a drop in SUV sales and trade-in values at dealerships.The U.S. Department of energy said that during the past week, U.S. gasoline topped $3 a gallon - the highest level since October 2008. According to Alec Gutierrez,lead analyst for vehicle evaluation at Kelley Blue Book, SUV sales have decreased about 1 percent since the last major gasoline price hike in spring 2008. He doesn't believe that SUV sales will decrease significantly unless prices reach $3.50 to $4 per gallon. if a gasoline price hike of 5 percent caused the SUV sales drop described, what is the cross-price elasticity of demand between gasoline and SUVs?arrow_forwardSummarize this While the major economies slid into recession and industries suffered great losses to the COVID-19 pandemic, E-commerce sales saw explosive growth. In this rapid movement of consumers to online purchasing and delivery services, there has been a large increase in the demand for packaging materials, such as cardboard boxes. Supporting this, Parcel Shipping Index by Pitney Bowes Inc. (2020) finds global parcel volume exceeding 131 billion, a 27% increase from 2019. Corrugated cardboards are largely and versatilely used for secondary packaging of goods, up to the tertiary packaging of large packs into mass cargo (Saxon Packaging, 2020). In addition to its relatively low cost, its strength and durability are also remarkable in protecting a variety of products from damage, notably during the shipment process. Given this, businesses have been largely reliant on the material as a practical, secure, and sustainable way of containing their products from production centers to…arrow_forwardOn September 28, 2012. The Wall Street Journal reported that in the second quarter, the number of cellphone subscribers on contract plans rose just 0.7% from the year before, to 219 million, according to UBS AG. The number of prepaid customers grew about 11.7% to 71 million. How many prepaid customers were there in the second quarter of 2011?arrow_forward
- Related Rates - Homework Due date: 4:00AM Oct 21, 2020 PROBLEM 3 Demand Rate When the price of a certain commodity is p dollars per unit, customers demand x thousand units of the commodity, where 9x +3px +5p² = 1075.85. How fast is the demand x changing with respect to tíme when the price is $13.30 per unit and is decreasing at the rate of $2.90 per month? (Note: you may need the quadratic formula.) O Give your answer as a decimal accurate within #1% of the exact answer.arrow_forwardAssume that GBP|USD = 2.00 (rate chosen for math ease). After the passage of a significant tax increase in the United States, the United States stock market is expected to drop significantly over the next month while the British stock market is expected to show steady growth. As a result which of following is most likely in a graph of the currency market with GBP per USD (original equilibrium is USD|GPB = 0.50) on the vertical axis (quantity of USD on horizontal axis)? Drawing a diagram would be useful. A. The supply curve would shift left and the new price would be greater than 0.50. B. The supply curve would shift right and the new price would be greater than 0.50. C. The supply curve would shift left and the new price would be less than 0.50. D. The supply curve would shift right and the new price would be less than 0.50.arrow_forwardWe write the change in total revenue with respect to change in price as dTR/dP. What is the correct expression in the right side of the following equation? dTR/dP= A.) Q(1-n) B.) Q(1+n) C.) Q[1-(1/n)] D.) Q[1+(1/n)]arrow_forward
- A company has sold 5000 units of 100 dinars its own product at a price of per unit. If you know that the rent of the company's building for the specified financial period = 75,000 dinars, the wages of administrative staff = 50,000 dinars, and the cost of materials used in the production of the sold units = 15 dinars / unit, and the cost of work (wages of workers) in the production of units sold = 5 dinars/ unit, and the amount of depreciation for fixed assets for the financial period = 15000 dinars, and marketing expenses of units sold = 7 dinars / unit, the contribution margin per unit is? 77 73 82arrow_forwardQuestion 21: UK petrol price jumps above £1.50 as oil costs rise Fuel prices have hit record highs in the UK as Russia's invasion of Ukraine continues to affect global oil prices. The average price of petrol jumped to £1.51 a litre, while diesel increased to £1.55. The cost of filling a 55-litre family car with unleaded petrol is now £83, or £85 for diesel. The price of Brent crude oil rose by 4.6% to $102 barrel after Western nations imposed new sanctions on Russia - one the world's largest energy producers. Petrol price movements in the UK are mainly determined by the price of crude oil, and the exchange rate between the dollar and the pound, because fuel, like oil is traded in dollars. Petrol also has a relatively low price elasticity of demand. UK consumers are already paying a high price for fuel, with demand surging following the easing of Covid restrictions. Steve Irwin, from fuel consultancy firm Portland, told the BBC that prices had also risen due to concerns over oil and gas…arrow_forward3. Supply and demand for loanable funds The following graph shows the market for loanable funds in a closed economy. The upward-sloping orange line represents the supply of loanable funds, and the downward-sloping blue line represents the demand for loanable funds. Supply Demand 100 200 300 400 500 LOANABLE FUNDS (Billions of dollars) A INTEREST RATE (Percent) m 0 0 600arrow_forward
- Imagine Tom's annual salary as an assistant store manager is $30,000, he owns a building that rents for $10,000 yearly, and his financial assets generate $1,000 per year in interest. One day, after deciding to be his own boss, he quits his job, evicts his tenants, and uses his financial assets to establish a bicycle repair shop. To run the business, he outlays $15,000 in cash to cover all the costs involved with running the business, and earns revenues of $50,000. Which of the following statements is true? Tom earns an accounting profit of $35,000. Tom has an opportunity cost of $41,000. All of these are true. Tom experiences an economic loss of $6000.arrow_forwardis the source of the supply of loanable funds. As the interest rate falls, the quantity of loanable funds supplied than the quantity of loans the interest rates they charge, thereby the quantity of loanable funds demanded, moving the market toward Suppose the interest rate is 5.5%. Based on the previous graph, the quantity of loanable funds supplied is demanded, resulting in a of loanable funds. This would encourage lenders to the quantity of loanable funds supplied and the equilibrium interest rate ofarrow_forwardJohn is deciding whether to go to college. He knows that if he goes, he will have to quit his $15,000 a year job. He needs to know what is the true cost of attending his first year of college. John's expenses of going to college of college tuition are: $10,000 ( $7000 tuition, $1000 for books, and $2000, for extra transportation costs.) John could have invested the $10,000 he spent on his tuition at a yearly interest rate is 10%. How would an economist would calculate the cost of of going to college for one year.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Principles of Economics (12th Edition)EconomicsISBN:9780134078779Author:Karl E. Case, Ray C. Fair, Sharon E. OsterPublisher:PEARSON
Engineering Economy (17th Edition)EconomicsISBN:9780134870069Author:William G. Sullivan, Elin M. Wicks, C. Patrick KoellingPublisher:PEARSON
Principles of Economics (MindTap Course List)EconomicsISBN:9781305585126Author:N. Gregory MankiwPublisher:Cengage Learning
Managerial Economics: A Problem Solving ApproachEconomicsISBN:9781337106665Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike ShorPublisher:Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-...EconomicsISBN:9781259290619Author:Michael Baye, Jeff PrincePublisher:McGraw-Hill Education
Principles of Economics (12th Edition)
Economics
ISBN:9780134078779
Author:Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:9780134870069
Author:William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:PEARSON
Principles of Economics (MindTap Course List)
Economics
ISBN:9781305585126
Author:N. Gregory Mankiw
Publisher:Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-...
Economics
ISBN:9781259290619
Author:Michael Baye, Jeff Prince
Publisher:McGraw-Hill Education