The accompanying table shows the total costs and total benefits, in billions of U.S. dollars, for four different antipollutio programs of increasing scope. Use cost-benefit analysis to determine which program should be undertaken. (LO2) Program Total Cost Total Benefit A $ 100 B 280 480 1,240 CD с $200 350 470 580
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- 3-3 Breakeven analysis (LO 1) Julianna Abdallah owns and operates FirstCakes, a bakery that creates personalized birthday cakes for a child's first birthday. The cakes, which sell for $40 and feature an edible picture of the child, are shipped throughout the country. A typical month's results are as follows: Sales revenue Variable expenses $840,000 630,000 Contribution margin 210,000 Fixed expenses 112,000 Operating income $ 98,000 Required a. What is FirstCakes' contribution margin per unit? b. What is FirstCakes' monthly breakeven point in units? e. What is FirstCakes' contribution margin ratio? d. What is FirstCakes' monthly breakeven point in sales dollars?Jonathon and his family were negotiating a lease for commercial premises to be used for their Italian restaurant. Part of the negotiation concerned the ability of Jonathon to demolish a wall in order to remodel the interior and build a pizza oven. The landlord shook Jonathon’s hand and told him they had a deal and that he could go ahead and get started. Jonathon took out a large bank loan to finance the remodelling. Four weeks later, Jonathon received a letter from the landlord indicating that he did not intend to proceed with the lease. Jonathon has already spent $100,000 on the remodelling but he has not received a signed a lease as yet. Since there is no breach of contract, does Jonathon have any other recourse in equity?Paolo lives in Philadelphia and operates a small company selling scooters. On average, he receives $712,000 per year from selling scooters. Out of this revenue from sales, he must pay the manufacturer a wholesale cost of $412,000. He also pays several utility companies, as well as his employees wages totaling $269,000. He owns the building that houses his storefront; if he choose to rent it out, he would receive a yearly amount of $1,000 in rent. Assume there is no depreciation in the value of his property over the year. Further, if Paolo does not operate the scooter business, he can work as a nurse and earn a yearly salary of $21,000 with no additional monetary costs, and rent out his storefront at the $1,000 per year rate. There are no other costs faced by Paolo in running this scooter company. (Questions in images)
- Tamika, a young entrepreneur, has been purpose-driven toward social change in their rural community. They have created solutions for pesticide runoff, erosion problems, and toxic well water. Tamika has decided to focus more on energy conservation and local air quality. Their first client is interested in wind as a power source. Tamika is unfamiliar with wind power and needs to learn about innovative solutions for residential application. How might Tamika use creative problem solving methods to develop solutions for the client’s request?Kim works as a physiotherapist. She currently earns a salary of $6479 per month. The only costs associated with working as a physiotherapist are fixed costs (e.g. maintaining her licence to practice physiotherapy) of $289 per year. Due to changes in the health care sector, Kim is deciding whether she should become a general practitioner instead. She estimates her salary as a general practitioner will be $8563 per month. What is Kim's monthly economic loss from working as a physiotherapist? Assume the same fixed costs apply to both the physiotherapist and general practitioner options, because the licences for physiotherapists and general practitioners cost the same amount of money. Answer as a positive number to the nearest whole value (with no decimal places, $or - signs, spaces or commas).Complete the accompanying table and answer the accompanying questions. (L01, LO6, LO7) a. At what level of the control variable are net benefits maximized? b. What is the relation between marginal benefit and marginal cost at this levelof the variable? Control Variable Q Total Benefits B(Q) Total Cost C(Q) Net Benefits N(Q) Marginal Benefit MB(Q) Marginal Cost MC(Q) Marginal Cost MC(Q) 100 1200 950 60 101 1400 70 102 1590 80 103 1770 90 104 1940 100 105 2100 110 106 2250 120 107 2390 130 108 2520 140 109 2640 150 110 2750 160
- A developer of high-priced executive tract homes has offered you $1000 per acre for the 500 acres of Vermont countryside you inherited from your Aunt Prudence. The Vermont Land Trust makes a counter offer of $500 per acre for the development rights to the land. By selling off the development rights only, you get to keep title to the land, and can use it for commercial purposes so long as these uses don't involve clearing the land of its forest. You know that you can continue Prudence's maple sugar operations, and you understand that you can probably collect hunting fees annually from private individuals wishing to use your land. How much would you and your heirs in perpetuity have to collect annually as a result of these low impact uses (maple sugaring and hunting) in order for you to agree to sell the development rights to the Vermont Land Trust, assuming that you wish to maximize your revenues from Aunt Prudence's estate, and that your discount rate is 5%? Please format your answer…The costs of producing a commodity consist of ₱102.00 per unit for labor and material cost and ₱54.00 per unit for other variable cost. The fixed cost per month amounts to ₱850,000. The commodity is sold at ₱740.00 each,a. what is the break-even quantity per month?(Hint: for Break-even quantity, COST = REVENUE)b. how many units must be produced each month in order that the net profit equalsthe cost?c. what is the net profit if for a production of 4000 units per month, in pesos?(HInt: PROFIT = REVENUE - COST)Anna spends Php400,000 per year on painting supplies and storage space. She recently received two (2) job offers from a famous marketing firm – one offer was Php150,000 per year and the other was Php100,000 per year. However, she turned both jobs down to continue a painting career. If Ann sells 45 painting per year at a price of Php10,000 each: What are her economic profits?
- Mutale, a lawyer, working for a large law firm and earning K60, 000 per year, is contemplating setting up his own law practice. He estimates that renting an office would cost K10,000 per year, hiring a legal secretary would cost K20,000 per year, and purchasing supplies, paying for electricity, telephone and so forth would cost another K5, 000 per year. The lawyer estimated that his total revenue for the year would be K100, 000. a) How much are the explicit costs of running the law firm? b) How much are the implicit costs? c) How much are the economic costs? d) Should the lawyer go ahead to set up the law firm?SITUATION: You are thinking about becoming a Paradise Coffee franchisee. Franchisees are offered a business specializing in producing an exclusive line of exotic coffee drinks (similar to Starbucks). Franchisees have had good success in towns without a Starbucks (Paradise franchises gross $220,000 sales on average per year, and you believe you can gross as much, too). You will have to pay Paradise Coffee, Inc., a franchise fee of $3,000 a year plus 2.5% of gross sales. You will also pay an annual National advertising fee of 3% of gross sales. Paradise requires that you use their logo-imprinted goods (plates, cups, napkins). They are purchased in bulk from Paradise and will cost you $40,000 per year. You also have to use their special Paradise Roast coffee beans, which cost $12.00 per pound. You estimate you will use 400 pounds of beans a year. Other food ingredients (syrups, biscotti, whipped cream, soft drinks, etc) will cost $18,000 a year. You will have to hire three…Qantas expects to cut its fuel bill by as much as $40 million a year thanks to a radical overhaul to how it plots its flights across the globe. The airline has spent five years and millions of dollars building a new flight planning program – which it says will materially cut its fuel bill and bring its ultra-haul ambitions closer to reality. Qantas’ team of dispatchers have used the same computer program for 30 years to plan the route of each flight, assessing weather, airspace traffic, safety and legal constraints on three of four possible routes. The new system uses cloud computing to crunch data on thousands of possible flight paths, using millions of data points – including the latest wind patterns, and varying altitudes and wind speeds – to build a cost map that presents the most efficient route… A flight to Johannesburg, for example, was directed to fly 160 nautical miles further than it would normally, but in doing so cut the headwinds it experienced by two-thirds. The 747…