If you have the following estimated model SALES = 115 - 2.5 PRICE + 20 ADVERT - 2.50 ADVERT2 where PRICE is in $, and SALES and ADVERT are in $1000. What is the marginal effect of advertising on sales when advertising level is $1500? Select one: O a. Sales decreases by $1,500. O b. Sales increases by $1,500. O C. Sales increases by $7,500. O d. Sales increases by $12,500.

A manufacturer sells a particular product in both Brazil and the U.S.  In Brazil, the manufacturer has been selling 4,900 units per year of the product at a price of $200 and a contribution margin of 25 percent. For sales of this product in Brazil, calculate the breakeven sales level for a $20 price increase.  Show your work. In the U.S., the manufacturer’s price for this product is $400 and the contribution margin is 50 percent.  The manufacturer knows that, because of gray market commerce, every one-unit change of sales of this product in Brazil leads to a 0.15-unit sales change in the opposite direction in the U.S.  Given this information, recalculate the breakeven sales level in Brazil described in Part a. Show your work. Using the course material, describe the concept of a price corridor.  Then explain how the difference between the breakeven you calculated in Part (b) and the one you calculated in Part (a) is helpful for applying the price-corridor concept in this situation.

The owner of a ski resort is considering installing a new ski lift that will cost $850,000. Expenses for operating and maintaining the lift are estimated to be $2,000 per day when operating. The U.S.Weather Service estimates that there is a 55% probability of 90 days of skiing weather per year, a 30% probability of 100 days per year, and a 15% probability of 120 days per year. The operators of the resort estimate that during the first 90 days of adequate snow in a season, an average of 550 people will use the lift each day, at a fee of $10 each. If 10 additional days are available, the lift will be used by only 450 people per day during the extra period; and if 20 more days of skiing are available, only 250 people per day will use the lift during those days. The study period is eight years; the ski lift will be depreciated by using the MACRS Alternative Depreciation System (ADS); the ADS recovery period is seven years; MARR = 10% per year (after-tax); and the effective income tax rate…

urgent

St. John's Brewery (SJB) is getting ready for a busy tourist season. SJB wants to either increase production or produce the same amount as last year, depending on the demand level for the coming season. SJB estimates the probabilities for high, medium and low demands as 0.2, 0.3, and 0.5 respectively, on the basis of the number of tourists forecasted by the local recreational bureau. If SJB increases production, the expected profits corresponding to high, medium and low demands are $750,000, $325,000 and $100,000 respectively. If SJB does not increase production, the expected profits are $450,000, $325,000 and $150,000 respectively. (NOTE: Text answers are case sensitive and the value of different parts of this question is indicated in square brackets [*/*]) Construct a decision tree for SJB. On the basis of the EV, what should SJB do? What is the expected value of increasing production? What is the expected value of not increasing production? Should SJB increase production (enter…

Fethe's Funny Hats is considering selling trademarked, orange-haired curly wigs for University of Tennessee football games. The purchase cost for a 2-year franchise to sell the wigs is $20,000. If demand is good (40% probability), then the net cash flows will be $27,000 per year for 2 years. If demand is bad (60% probability), then the net cash flows will be $9,000 per year for 2 years. Fethe's cost of capital is 14%. A. What is the expected NPV of the project? B. Use decision-tree analysis to calculate the expected NPV of this project, including the option to continue for an additional 2 years. B. Use decision-tree analysis to calculate the expected NPV of this project, including the option to continue for an additional 2 years.

You decide to invest in a portfolio consisting of 21 percent Stock X, 48 percent Stock Y, and the remainder in Stock Z. Based on the following information, what is the standard deviation of your portfolio? State of Economy Normal Boom Probability of State of Economy .84 .16 Return if Stat Stock X Stock Y 10.20% 3.60% 17.50% 25.50%